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Saturday, November 23, 2024

Independence man admits guilt in COVID relief fraud scheme

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U.S. Attorney Teresa A. Moore | US Attorney - Western District of Missouri

U.S. Attorney Teresa A. Moore | US Attorney - Western District of Missouri

An Independence, Missouri man has admitted guilt in a federal court for submitting a false claim to fraudulently acquire nearly $1.4 million in COVID-19 relief funds. Richard Dean Schiele, Jr., 51, entered his guilty plea before U.S. Chief District Judge Beth Phillips, waiving his right to a grand jury.

The charges stem from the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), which included an Employee Retention Credit aimed at encouraging businesses to retain employees during the pandemic. The credit was available to eligible employers who paid qualified wages after March 12, 2020, and before January 1, 2022.

Schiele confessed to filing nine Employer’s Quarterly Tax Return forms with the IRS on April 22, 2023. These filings were for a company he established that same month named Schiele Family Own Distribution. He claimed $1,392,716 in credits against supposed employment taxes of the company which did not have any employees between 2020 and 2022.

The IRS issued checks totaling $478,890 based on these false claims. Of this amount, the Treasury Department managed to recover $348,764.91 from Schiele's bank account. According to the plea agreement terms reached today, Schiele is required to pay $130,125 as restitution to the IRS.

Under federal law statutes related to this offense, Schiele could face up to five years in federal prison without parole; however, his sentence will be determined by the court following advisory sentencing guidelines and other statutory factors after a presentence investigation conducted by the United States Probation Office.

Assistant U.S. Attorney Paul S. Becker is prosecuting this case following an investigation by IRS-Criminal Investigation.

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