A Mount Vernon city employee, her daughter, and a former resident are facing charges for allegedly taking advantage of the COVID-19 pandemic to bilk the government out of more than $1.6 million in loans earmarked for small businesses and then accepting kickbacks.
Andrea Ayers, a civilian employee of the Mount Vernon Police Department, and her daughter, Alicia Ayers, who operates a travel agency were arrested in the city on Tuesday, March 23 for allegedly submitting applications for more than 300 people to claim federal loans for businesses that did not qualify for.
A third suspect, Traci Proctor, who also worked in Mount Vernon city government before moving south, was also arrested on Tuesday in Georgia.
U.S. Attorney Audrey Strauss said that the three women have been charged with conspiracy to commit wire fraud, wire fraud, false statements, and aggravated identity theft in connection with a scheme to defraud the U.S. Small Business Administration (SBA), out of more than $1.6 million.
During the pandemic, Congress expanded the SBA’s Economic Injury Disaster Loan Program to provide small businesses with low-interest loans of up to $2 million before May last year, and up to $150,000 beginning in May 2020 to “provide vital economic support to help overcome the loss of revenue small businesses are experiencing due to COVID-19.”
It is alleged that in June and July 2020, both Ayers and Proctor used the identifies of approximately 300 other people to submit 315 online applications to the SBA seeking more than $3 million in funding through the program.
Strauss said that on the applications, the three would falsely report the number of employees working for the purported businesses, most of which never existed at all.
Based on the fraudulent applications, the SBA made advance payments of approximately $1,690,000 to the “applicants” who then kicked back a portion of the money to the three women, usually between $1,000 and $5,000 each.
“As alleged, the defendants schemed to defraud the SBA by submitting disaster loan and grant applications for non-existent businesses,” Strauss said. “In so doing, they stole funds intended for the many small businesses that are struggling as a result of the COVID-19 pandemic.”
Alicia Ayers, 34, Andrea Ayers, 54, and Proctor, 47, were charged with:
- Conspiracy to commit wire fraud
- Wire fraud;
- Making false statements;
- Aggravated identity theft.
“While small businesses throughout the country were clamoring for the economic support they so desperately needed after the first quarter of the pandemic, those charged today allegedly saw the SBA’s Economic Injury Disaster Loan Program as nothing more than an opportunity to turn a quick profit,” FBI Assistant Director William Sweeney said.
“As alleged, Ayers, Ayers, and Proctor filed more than 300 online applications on behalf of others that included false information to support their claims.
“This resulted in nearly $1.7 million worth of payments from the SBA, a portion of which the defendants received in the form of kickbacks," Sweeney continued. "No matter how creative the scheme is, rest assured those who siphon money from taxpayer-funded programs will be aggressively pursued. This investigation remains ongoing.”
Both the Ayers appeared in court in White Plains on Tuesday afternoon and were released on a $150,000 bond. Proctor was also scheduled to appear in federal court in Georgia.
If convicted of the top charge, the three women face up to 20 years in prison.
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