Tonya Barham, a 63-year-old resident of Hamden, Connecticut, pleaded guilty in federal court to defrauding the government out of nearly $800,000 in COVID-19 pandemic relief funds, nhregister.com reported.
Appearing before U.S. District Judge Sarah F. Russell in New Haven on Tuesday, Barham waived her right to be indicted and pleaded guilty to making false claims regarding IRS refunds. The crime carries a maximum penalty of five years in prison, according to the U.S. Attorney’s Office, District of Connecticut.
The federal government launched employee retention credits in March 2020. These credits were designed to repay employers for specific costs incurred while retaining staff during the pandemic, allowing business owners to recoup previously paid wages and health insurance expenses. Authorities also established a program to reimburse small and mid-sized businesses for providing COVID-19-related sick and family leave wages.
Barham owned Blackfoot LLC, a small business that sold health products, lotions, oils, and candles. However, officials stated that the enterprise earned little to no income and employed no staff.
In late 2021, an acquaintance instructed Barham to open an online account with a business providing online tax preparation services. Between March 2022 and January 2023, that tax preparation business accessed Barham’s account and filed tax returns for Blackfoot LLC that misrepresented the total wages paid and the number of employees. Officials noted that Barham provided false information, including the claim that her business maintained five employees.
Between July and November 2022, Blackfoot LLC collected nine separate IRS refund checks totaling $799,052. Barham subsequently kicked a portion of those funds back to the individuals who orchestrated the scheme, according to officials.
Following her guilty plea, Barham was released on a $40,000 bond. Her sentencing is scheduled for January 26, 2027.
