Two Columbus-area women charged with stealing over $2.8 million in COVID relief funds
Two Columbus-area women are accused of fraudulently obtaining more than $2.8 million in federal COVID-relief funds, some of which was spent on liposuction, purchase and renovation of a Westerville condominium, property in Australia and more.
Lorie A. Schaefer, 62, of Westerville, and Latisha C. Holloway, 42, of Reynoldsburg, have been arrested and charged in U.S. District Court in Columbus with federal theft and fraud crimes involving the Paycheck Protection Program, which was created to provide COVID relief to businesses.
U.S. Attorney Kenneth Parker announced the charges Wednesday after an investigation by the U.S. Department of Transportation Office of Inspector General.
Schaefer is accused of claiming a fraudulent affiliation with Flying Pizza restaurants in Dayton, Centerville and Fairborn to get almost $1.9 million in federal PPP funds. She stands accused of opening new bank accounts in December 2020 before registering a fake business name with the state in March 2021.
Besides stating she started the company in March 2021, federal prosecutors allege Schaefer reported on documents to obtain the funds that she had 98 employees and submitted a bank statement, tax records and an IRS letter that were fraudulent as part of her application for a PPP loan. She also allegedly said she wasn't under indictment, despite theft charges pending against her in Meigs County.
When officials at the family-owned Flying Pizza stores found out an application was filed in their business' name, they reported it, saying their restaurants couldn't justify that much money in a loan, according to Parker's office. Flying Pizza was actually established in 1984.
Schaefer's bank records allegedly show that she used the funds for personal expenses, including $26,000 for liposuction; $10,000 for a newborn baby gift; and more than $900,000 to buy and renovate a Westerville condo. She also allegedly bought vehicles in Ohio; a property in Australia; and items from Wayfair, Lamps Plus, Kroger, KFC, Burger King, Arby’s, McDonald’s and Olive Garden, according to Parker's office.
Schaefer also allegedly used someone else's Social Security Number to apply for and obtain $20,800 in PPP funds for a corporation she established called LS Associates.
Holloway is accused of gaining more than $980,000 of her own fraudulent PPP loan money with Schaefer's help, federal prosecutors allege.
The money was for a business Holloway allegedly claimed to own, called Jaguar Logistics LLC. She filed on her federal PPP loan application that she had 76 employees, total gross income of $4.9 million and she also attached fraudulent tax records and a bank statement. Holloway sent in her application within a month of Schaefer getting PPP loans, and Holloway sent Schaefer $180,000 after she got her PPP loan, Parker's office said.
In addition, both women also collected unemployment benefits after getting the federal PPP relief funds, the release said.
“As Attorney General Merrick Garland recently made clear, while the COVID-19 public health emergency may have ended, our work to identify and hold accountable those who stole pandemic relief funds is far from over,” Parker said in the prepared release. “Working alongside our law enforcement partners, we will continue to prosecute the individuals who engaged in these illegal activities.”
dking@dispatch.com
@DanaeKing
This article originally appeared on The Columbus Dispatch: Two Columbus-area women charged fraud over $2.8M in fed COVID funds
