Grand jury indicts 2 Central Ohio women in $2.8 million in COVID-relief fraud scheme

COLUMBUS, Ohio – A federal grand jury has charged two Central Ohio women with crimes related to fraudulently receiving more than $2.8 million total in covid-relief funds from the Paycheck Protection Program (PPP).

Lorie A. Schaefer, 62, of Westerville, allegedly received nearly $1.9 million in covid-relief funds by fraudulently claiming an affiliation with an Ohio pizza company.

According to the indictment, Schaefer opened new bank accounts in December 2020 prior to registering a fictitious business name with the State of Ohio in March 2021.

It is alleged that Schaefer fraudulently claimed affiliation with the Flying Pizza restaurants in Dayton, Centerville and Fairborn. When notified that a PPP loan for nearly $1.9 million had been filed in the name of Flying Pizza, individuals at the family-owned business said their restaurants could not justify such a large loan.

Schaefer claimed to have 98 employees and allegedly submitted altered bank records as part of her application. Schaefer also claimed the business was established in March 2021, even though the original Flying Pizza was established in 1984. Additionally, she claimed not to be under indictment despite having pending theft charges in Meigs County. Schaefer allegedly attached multiple fraudulent documents to her PPP application, including a bank statement, tax records, and a letter from the IRS.

Bank records indicate Schaefer improperly used PPP funds for personal expenses, for example, nearly $26,000 on liposuction, a $10,000 check for a “newborn baby gift,” and more than $900,000 to purchase and renovate a condominium in Westerville. Schaefer also allegedly made purchases at Wayfair, Lamps Plus, Kroger, KFC, Burger King, Arby’s, McDonald’s and Olive Garden. Evidence also suggests Schaefer used the fraud proceeds to purchase vehicles in Ohio and property in Australia for her personal use.

Schaefer allegedly assisted co-defendant Latisha C. Holloway, 42, of Reynoldsburg, in fraudulently receiving more than $980,000 in PPP loans.

Holloway allegedly claimed to own a business called Jaguar Logistics, LLC. Holloway stated on loan application documents that she had 76 employees and had a total gross income of $4.9 million. Her loan application was submitted within a month of Schaefer receiving PPP loans and records indicate Holloway wired Schaefer $180,000 after receiving her own loan money. According to court records, Holloway similarly attached fraudulent documents to her PPP loan, including a bank statement and tax records.

Both defendants allegedly collected unemployment benefits after receiving federal covid-relief funds.

Finally, it is alleged that Schaefer used another individual’s Social Security Number to apply for and receive an additional $20,800 in PPP funds for “LS Associates,” a corporation established by Schaefer.

The indictment charges each woman with two counts of wire fraud and one count of money laundering. Wire fraud is punishable by up to 20 years in prison and money laundering carries a potential penalty of up to 10 years in prison.

Schaefer and Holloway were arrested in August 2023 and originally charged at that time by criminal complaint.

Kenneth L. Parker, United States Attorney for the Southern District of Ohio, announced the case, which was investigated by the U.S. Department of Transportation Office of Inspector General and the Federal Bureau of Investigation (FBI), Cincinnati Division. Assistant United States Attorney David J. Twombly is representing the United States in this case.

An indictment merely contains allegations, and defendants are presumed innocent unless proven guilty in a court of law.

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