NEVADA – The U.S. Department of Justice (DOJ) announced December 12 that a woman pleaded guilty to conspiring to defraud the United States by claiming false COVID-19 employment tax credits.
Lakeibia Fannin, of Illinois, conspired in Nevada from June 2022 through November 2023 to file tax returns claiming fraudulent employee retention credits (ERC) and paid sick and family leave credits.
Fannin and her businesses were not eligible for the claimed refundable credits.
She used the proceeds for personal expenses, including vacations, a cruise, jewelry, designer clothes, and a car.
In total, Fannin requested more than $3.5 million and received over $1.4 million.
ERC helped small businesses reduce tax liability
Congress authorized the ERC during the COVID-19 pandemic to help small businesses reduce employment tax obligations. Congress also authorized tax credits to reimburse businesses for wages paid to employees on COVID-19-related sick or family leave.
The credit covered sick and family leave wages up to a maximum amount.
Faces up to 10 years in prison
Fannin is scheduled to be sentenced on March 19, 2026.
She faces up to 10 years in prison, along with supervised release, restitution, and fines. She has agreed to pay over $1.4 million in restitution to the IRS.
