ROCHESTER, N.Y. (WROC) — A Rochester man was sentenced to serve two years in prison after he was convicted on wire fraud charges.
Here’s how the scheme worked, according to the US Attorney’s Office:
In February 2020, 47-year-old Kenyatta Phipps filed a federal income tax return for 2019. He reported wages and interest of over $13,000 and received a refund of $696.
In August of that same year, Phipps tried to file a second tax return four times. On that return, it was incorrectly reported that he made additional income in the amount of $333,522 from his company Platinum Express Cleaning. If it was accepted, he would have received a refund of $164,951.
After these attempts failed, Phipps filed a fraudulent amended return in September of that year. That return falsely reported that his company received gross receipts of $455,734 from Eastman Kodak Company and that he had taxes withheld from income of over $355,000. He received a refund and tax loss to the IRS of $186,570.
Prosecutors said that Phipps used information from those returns to submit three fraudulent applications to obtain COVID relief funding through the Economic Injury Disaster Loans.
On the applications, Phipps falsely said he had over 120 employees, which would’ve qualified the company to receive over $570,000 in loans. The Small Business Administration discovered the applications were false.
Phipps was charged with wire fraud and was sentenced to 24 months in prison. He is also ordered to pay restitution of over $376 thousand.