A former TV news anchor and her husband face indictments from the US Justice Department for their alleged involvement in a scheme to fraudulently obtain COVID-19 relief funds. If proven guilty, the couple could potentially face decades of imprisonment.
Stephanie Hockridge-Reis, aged 41, and Nathan Reis, aged 45, reportedly submitted deceptive and misleading applications for Paycheck Protection Program (PPP) loans from the federal government. These applications were made on behalf of their businesses, despite their ineligibility for such loans.
Hockridge-Reis, a former news anchor for ABC15-TV in Phoenix, along with her husband, co-founded Blueacorn. Blueacorn is a lender service provider that was established with the intention of assisting small businesses and individuals in accessing COVID-19 relief funds.
Federal prosecutors have stated that Hockridge-Reis and Reis engaged in the creation of fraudulent documents, including payroll records, tax documentation, and bank statements, with the purpose of securing loans.
According to the Justice Department, the couple has been accused of charging clients unlawful fees for their services, which were calculated based on a percentage of the funds they received.
The allegations also involve claims that the two individuals recruited individuals to serve as referral agents. These referral agents allegedly provided guidance to borrowers on how to submit fraudulent PPP loan applications.
According to the Justice Department, Reis, Hockridge, and their co-conspirators submitted PPP loan applications that they knew contained materially false information. Their motive was to obtain a greater volume of kickbacks from borrowers and a higher percentage of lender fees from the Small Business Administration.
The couple’s alleged fraud, as claimed by the DOJ’s complaint, does not specify the exact amount of money involved.
In 2022, a report from a congressional panel revealed that Blueacorn generated close to $300 million in profits. During the investigation, the company disclosed that it had amassed over $1 billion in fees for processing PPP applications, although it also incurred approximately $700 million in expenses.
According to the report, Blueacorn was accused of neglecting small businesses and focusing on securing loans for their largest clients in order to maximize their commissions.
According to a report by the Select Subcommittee on the Coronavirus Crisis, it is alleged that Hockridge-Reis and Reis personally collected $300,000 in PPP loans, which were partly facilitated by their own company.
According to the Arizona Republic, congressional investigators were informed by individuals who reviewed loan applications for Blueacorn that they were instructed to prioritize speed over verifying the legitimacy of the applications.
“I don’t believe in prioritizing the biggest loans over the smallest, but we should acknowledge that closing these monster loans will ensure that everyone gets paid,” expressed Hockridge-Reis in a Slack message obtained by the committee.
According to a Slack message obtained by congressional investigators, Hockridge-Reis expressed a dismissive attitude towards small loans, stating, “Delete them. Who cares. We’re not the first bank to decline borrowers who deserve to be funded.”
According to the panel report, it is alleged that the husband falsely claimed to be an African American and a veteran while filling out a loan application.
The couple’s lawyer’s contact information was not immediately available.