(The Center Square) – A woman pleaded guilty on Wednesday to defrauding a COVID-19 pandemic loan program out of $100,927 in U.S. District Court in St. Louis.
Francheska Reese, 36, of St. Peters, admitted she devised a scheme to defraud the Paycheck Protection Program between March 2020 and January. She pleaded guilty to one count of wire fraud.
The Paycheck Protection Program loans were a federal program intended to help small businesses continue to meet payroll and other expenses during the pandemic.
Reese submitted a fraudulent loan application for 1st Stop Child Development Center LLC on Jan. 21, 2021. Reese began annually registering the company with the Missouri Secretary of State’s Office in 2018. However, she never filed federal income or employment tax returns.
Reese falsely claimed her company employed seven full-time employees who were paid a total of $40,371 per month. She also falsely stated she would use the loan on payroll, rent, mortgage interest and utilities.
Reese transferred the loan of $100,927 into her personal account and spent the money on personal retail and car expenses along with other items, according to the plea agreement.
Reese will be sentenced on Oct. 25 and could face up to 20 years in prison, a fine of $250,000, or both prison and a fine. She also will be ordered to repay the money.
The case was investigated by the U.S. Secret Service and assistant U.S. Attorney Derek Wiseman is prosecuting the case.