Roanoke Woman Pleads Guilty in Paycheck Protection Fraud Scheme

ROANOKE, Va. – A Roanoke woman, who conspired with dozens of other individuals to commit wire fraud as part of a scheme to defraud the Paycheck Protection Program, pled guilty yesterday in U.S. District Court in Roanoke.

Jaimeka Michelle Austin, 31, pled guilty yesterday to one count of conspiracy to commit wire fraud and one count of money laundering. Austin was indicted in June 2024 along with 23 others as part of a 142-count indictment alleging wire fraud, conspiracy to commit wire fraud, money laundering, making false statements, and fraud in relation to an emergency benefits program.

The Paycheck Protection Program (PPP) was a COVID-19 pandemic relief program administered by the Small Business Administration (SBA) that provided forgivable loans to small businesses for job retention and certain other expenses.

Between June 2020 and December 2020, Austin communicated with several individuals, including a tax preparer, to inquire about obtaining a tax refund loan and a PPP loan.

In January 2021, after some back-and-forth discussion, Austin and the tax preparer began discussing obtaining PPP loans for other people by using false information on applications. They agreed to charge prospective loan applicants $5,000 to obtain a $20,000 PPP loan.

Austin recruited individuals to apply for PPP loans via social media and word of mouth, knowing that most who would be applying were not eligible to receive such loans because they did not own a business and were not self-employed at the time – two conditions required for PPP loans.

Austin and her co-conspirators submitted more than 100 fraudulent PPP loan applicants on behalf of the applicants, including for those that did not have a pre-existing business. These applications included multiple false statements, inflated business income, and fraudulent IRS Schedule C forms.

Austin also submitted fraudulent PPP loan applications for her own business, Mechelle’s Boutique. As a part of these applications, Austin vastly inflated the amount of revenue that Mechelle’s Boutique received. Based on her fraudulent submissions, Austin ultimately received two PPP loans totaling over $52,000. 

On October 4, 2021, Austin used some of the proceeds from her PPP fraud scheme to purchase a new construction single-family home in Charlotte, North Carolina. However, because Austin was already concerned that the “feds” were watching her and did not want to draw additional attention from the federal government, she sought to conceal the source of the funds she was using to make her $70,000 down payment on the home.

As a result, Austin gave $70,000 of her fraudulent proceeds to a third party; the third party then wired the funds to the closing attorney. Austin and the third party falsely represented that this money was a gift from the third party and that it did not originate from Austin. Austin closed on the Charlotte property two days later and used her fraud proceeds to pay some of the mortgage payments on the property. In May 2022, Austin filed a quitclaim deed granting herself and her mother joint ownership rights over the Charlotte property.

In April 2023, Austin and her mother listed the Charlotte property for sale, and it went under contract for $398,000. Austin and her mother were set to receive just under $95,000 in proceeds from this sale. In May 2023, the United States seized these sale proceeds, and, pursuant to an August 2024 default judgment, this money was forfeited to the United States.

Austin has agreed to pay full restitution for her offenses and has agreed to a forfeiture money judgment in the sum of $190,390.

Acting U.S. Attorney Zachary T. Lee, Stanley M. Meador, Special Agent in Charge of the FBI’s Richmond Division and Kareem A. Carter, Special Agent in Charge of the IRS’s Washington Field Office, made the announcement.

At sentencing, Austin faces up to 20 years in federal prison on the conspiracy to commit wire fraud count and up to 10 years on the money laundering count. She is the third of the 24 defendants charged in the indictment to plead guilty.

The Federal Bureau of Investigation and the Internal Revenue Service-Criminal Investigations is investigating the case.

Assistant U.S. Attorneys Jason M. Scheff and Lee S. Brett are prosecuting the case are prosecuting the case for the United States.