Illinois Woman Pleads Guilty To COVID-19 Fraud

LAS VEGAS - An Illinois woman pleaded guilty today to conspiring to defraud the United States by making claims for refunds of false COVID-19 related employment tax credits.

According to court documents and statements made in court, Lakeibia Fannin conspired with others in the State and Federal District of Nevada from June 2022 through November 2023 to file tax returns seeking fraudulent refunds based on the employee retention credit (ERC) and paid sick and family leave credit. Fannin and her businesses were not eligible to receive the refundable credits in the amounts claimed. Fannin used the proceeds for her personal benefit, including on vacations, a cruise, jewelry, designer clothes, and a car.

In total, Fannin requested more than $3.5 million and actually received over $1.4 million.

In response to the COVID-19 pandemic and its economic impact, Congress authorized the ERC for small businesses to reduce the employment tax owed to the IRS. Congress also authorized the IRS to give a credit against employment taxes to reimburse businesses for the wages paid to employees who were on sick or family leave and could not work because of COVID-19. This credit was equal to the wages the business paid the employees during the sick or family leave, subject to a maximum amount.

Fannin is scheduled to be sentenced on March 19, 2026. She faces a maximum penalty of 10 years in prison as well as a period of supervised release, restitution and monetary penalties. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors. Fannin has agreed to pay over $1.4 million in restitution to the IRS.

First Assistant United States Attorney Sigal Chattah for the District of Nevada and Acting Special Agent in Charge Jarom Gregory for the IRS Criminal Investigation's Phoenix Field Office made the announcement.

IRS Criminal Investigations and the Treasury Inspector General for Tax Administration are investigating the case.

Trial Attorney John C. Gerardi of the Criminal Division and Assistant U.S. Attorney Richard Anthony Lopez of the District of Nevada are prosecuting the case.

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