Former Phoenix police officer arrested for PPP loan fraud
Toni Richardson is accused of using the loan for personal expenses.
A former Phoenix police officer has resigned and been arrested amid accusations of PPP loan fraud.
Former officer Toni Richardson is facing charges after allegedly falsifying a loan application for the Paycheck Protection Program. She was able to obtain more than $1.2 million in government loans for a business that had no employees, federal prosecutors said.
Richardson used the money for personal expenses, according to The Arizona Republic. She and co-conspirator Willie Mitchell face federal charges of conspiracy, bank fraud, and transactional money laundering, KPHO-TV reports.
The pair described their business, called “The Lotto Club,” as a nonprofit for veterans. Richardson was listed as 100 percent owner and claimed to have about 85 employees with “an average monthly payroll ledger totaling over $500,000 on the application in February 2021,” the Republic reports.
Richardson and Mitchell intended to use “retain workers, maintain payroll, make mortgage interest payments, lease payments and utility payments.”
Prosecutors allege that Richardson and Mitchell transferred the money to their personal accounts and made multiple withdrawals.
Richardson was arrested by the FBI on Dec. 1 and has pleaded not guilty on all counts. She was reportedly released on her own recognizance.
“The department was notified of the circumstances surrounding the arrest and immediately began the process to terminate employment,” Sgt. Andy Williams, a spokesperson for the Phoenix Police Department, said in a statement.
“The employee submitted a letter of resignation prior to formal termination. The city of Phoenix takes allegations of criminal conduct by our employees very seriously. The alleged actions of this employee go against the core values of the city and everything we stand for as public servants.”
Richardson’s next court date has been set for Feb. 1, 2022.
The Paycheck Protection Program is part of the Coronavirus Aid, Relief and Economic Security (CARES) Act. It was established to help small businesses pay their employees and maintain their businesses during the coronavirus pandemic that has kept much of America in its grip.
Richardson is not alone in headline-making PPP loan fraud. In September, a Florida business owner was arrested and charged after fraudulently receiving $2 million in COVID-19 relief funds and using nearly $700,000 of it to buy a 40-foot boat.
Love & Hip Hop Atlanta star, Arkansas Mo (born Maurice Fayne), was charged in May with federal bank fraud after investigators discovered he used funds from a $2 million Paycheck Protection Program loan to buy luxury items for himself.
According to The Atlanta Journal-Constitution, Fayne ran a multi-state scheme that defrauded more than 20 people over seven years. He told investors he was going to use their money to operate a trucking business. However, according to investigators, Fayne used the money to fund his extravagant lifestyle.
In September, he was sentenced to 17 years in prison, theGrio reported.
This article contains additional reporting from theGrio’s Biba Adams.
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