NEWPORT NEWS, Va. — A Newport News woman pleaded guilty Monday to laundering proceeds of a pandemic-benefit fraud scheme, according to a press release from the U.S. Attorney’s Office for the Eastern District of Virginia.
According to court documents, on March 17, 2021, Shenita R. Banks, 50, applied for a loan for her company, Wireless Queen, Inc., through the Paycheck Protection Program, a COVID-19 relief program intended to provide loans backed by the Small Business Administration to certain businesses, nonprofit organizations, and other entities to help them retain their employees or stay afloat during the pandemic. Banks incorporated Wireless Queen, Inc., on July 27, 2015, but it had no business operations, employees, or sales in 2020.
In her application, Banks fraudulently claimed that the purpose of the loan was for payroll costs, rent/mortgage interest, utilities, and covered supplier costs. Banks falsely stated that her average monthly payroll costs were $58,900. As part of the application, Banks submitted copies of tax returns for tax year 2020, in which she reported payments to employees totaling $705,941.44. However, the IRS has no record of Banks filing these forms for tax years 2018 through 2022 or of Banks filing an individual Form 1040 tax return for those tax years.
On March 24, 2021, Banks’ PPP loan application was approved, and on March 25, 2021, Banks electronically signed the application attesting that the information provided was true and accurate and that she understood the criminal penalties associated with providing false statements to the SBA. Banks specifically certified that she was eligible to receive a loan under the rules issued by the SBA and that all loan proceeds would be used only for business-related purposes.
On March 31, 2021, Banks received $145,833 for the awarded funding to her business account held in the name of Wireless Queen Inc., which Banks opened the day before submitting the initial application. On April 5, 2021, Banks laundered $33,030 of the PPP loan funds by withdrawing them from the Wireless Queen bank account.
Banks is scheduled to be sentenced on Jan. 29, 2025, and faces up to 10 years in prison. Actual sentences for federal crimes are typically less than the maximum penalties.
