Nine coconspirators convicted in drug, money laundering, $4.5 million COVID-19 relief fraud conspiracies

DAYTON, Ohio - Nine defendants are now convicted in a case involving drug trafficking, money laundering and COVID-19 relief fraud conspiracies after the lead defendant pleaded guilty in U.S. District Court here.

Alex Garnett, 49, of Mason, pleaded guilty to conspiring to possess with intent to distribute 40 grams or more of fentanyl and 500 grams or more of cocaine, as well as wire fraud.

According to court documents, between September 2022 and March 2024, Garnett operated a drug trafficking organization, obtaining kilogram quantities of fentanyl and cocaine from co-defendant sources of supply and providing the drugs to other co-conspirators for resale.

Garnett and others deposited their drug proceeds into bank accounts in the name of fictitious businesses.

Co-defendant Kimberly Hubbard, 50, of Griffin, Georgia, conspired with other defendants to prepare materially false and fraudulent claims for COVID-19 relief funds, namely Employee Retention Credits (ERC). In total, Hubbard filed 26 fraudulent IRS forms claiming more than $4.5 million in ERC. The IRS disbursed approximately $207,000 of the fraudulent claims.

The others convicted include:

The defendants were indicted by a federal grand jury in May 2024.

This case is part of the Homeland Security Task Force (HSTF) initiative established by Executive Order 14159, Protecting the American People Against Invasion. The HSTF is a whole-of-government partnership dedicated to eliminating criminal cartels, foreign gangs, transnational criminal organizations, and human smuggling and trafficking rings operating in the United States and abroad. Through historic interagency collaboration, the HSTF directs the full might of United States law enforcement towards identifying, investigating, and prosecuting the full spectrum of crimes committed by these organizations, which have long fueled violence and instability within our borders. In performing this work, the HSTF places special emphasis on investigating and prosecuting those engaged in child trafficking or other crimes involving children. The HSTF further utilizes all available tools to prosecute and remove the most violent criminal aliens from the United States. HSTF Cincinnati comprises agents and officers from federal, state, and local law enforcement agencies.

Dominick S. Gerace II, United States Attorney for the Southern District of Ohio; Jared Murphey, Acting Special Agent in Charge, U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI) Detroit; and Karen Wingerd, Special Agent in Charge, Internal Revenue Service Criminal Investigation (IRS-CI); announced the guilty plea entered on June 5 before U.S. District Judge Michael J. Newman. Assistant Deputy Criminal Chief Amy M. Smith and Assistant United States Attorney Christina E. Mahy are representing the United States in this case.

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