Logan County Woman Pleads Guilty to COVID-19 Relief Fraud Scheme
CHARLESTON, W.Va. – A Logan County woman pleaded guilty today to wire fraud, admitting to a scheme to defraud the Paycheck Protection Program (PPP) of over $42,250.00 in COVID-19 relief loans guaranteed by the Small Business Administration (SBA) under the Coronavirus Aid, Relief, and Economic Security Act (CARES Act).
According to court documents and statements made in court, Alexis Ransom, 24, of Logan, applied for three PPP loans beginning on March 27, 2021, and continuing to August 16, 2021, for her purported business, Alexis Renae Ransom, which she claimed did business under the tradenames of Renae’s Fashion Consulting LLC and Momma & Me Boutique. Ransom admitted that she falsely stated that Renae’s Fashion Consulting LLC was established in 2019, and had earned $66,900.00 in gross income in 2019 and 2020, and that Momma & Me Boutique earned $69,000.00 in gross income in 2019. The investigation revealed that Ransom’s purported business and its tradenames had not engaged in substantial business activity before February 15, 2020. Ransom further admitted that she submitted a false Internal Revenue Service (IRS) Form 1040, Schedule C Profit or Loss from Business in connection with the first loan application she submitted for Renae’s Fashion Consulting LLC.
The CARES Act is a federal law enacted on March 29, 2020, designed to provide emergency financial assistance to the millions of Americans who are suffering the economic effects caused by the COVID-19 pandemic. One source of relief provided by the CARES Act was the authorization of forgivable loans to small businesses for job retention and certain approved expenses, through the PPP. Businesses must use PPP loan proceeds for payroll costs, interest on mortgages, rent and utilities.
Ransom obtained two PPP loans of $13,937.50 each for Renae’s Fashion Consulting LLC, and one loan of $14,375.00 for Momma & Me Boutique. Ransom admitted that she later applied to have all three PPP loans forgiven even though she had not spent the loan proceeds on permissible business expenses. The SBA forgave her loans on August 16, 2021.
Ransom is scheduled to be sentenced on November 16, 2022 and faces a maximum penalty of 20 years in prison, three years of supervised release, and a $250,000 fine. Ransom also agreed to pay $42,250.00 in restitution.
United States Attorney Will Thompson made the announcement and commended the West Virginia State Police and the United States Secret Service for conducting the investigation.
Senior United States District Judge David A. Faber presided over the hearing. Assistant United States Attorney Kathleen Robeson is prosecuting the case.
On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the Department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.
Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Southern District of West Virginia. Related court documents and information can be found on PACER by searching for Case No. 2:22-cr-122.