Arizona Man Pleads Guilty to COVID-19 Relief Fraud, Filing False IRS Claim

Yesterday, Roy L. Layne of St. David, Arizona, admitted to defrauding the IRS and SBA of more than $850,000 in COVID-19 relief funds.Photo byImage: Tysonomo Multimedia

PHOENIX — An Arizona man pleaded guilty on Wednesday to wire fraud and filing a false refund claim with the Internal Revenue Service (IRS), admitting to obtaining more than $850,000 through fraudulent means from the IRS and the U.S. Small Business Administration (SBA).

Roy L. Layne, 44, of St. David, admitted to submitting false applications in 2020 and 2021 for loans from the Paycheck Protection Program (PPP) and the Economic Injury Disaster Loan (EIDL) program.

These federal programs were created to provide financial assistance to Americans suffering economic harm due to the COVID-19 pandemic, according to DOJ.

According to court documents and statements made in court, Layne falsely claimed that several businesses he controlled had dozens of employees and earned substantial gross receipts.

To substantiate these fraudulent claims, Layne fabricated business and employment tax forms, which he submitted to the IRS and SBA.

His false applications resulted in the disbursement of over $300,000 in loans for which he was not eligible.

Further compounding his fraudulent activities, Layne filed false tax returns with the IRS in 2022, seeking nearly $7.5 million in refunds. The IRS paid out approximately $550,000 based on these fraudulent claims, according to DOJ.

Layne is scheduled to be sentenced on February 3, 2025. He faces a maximum penalty of 30 years in prison for each wire fraud charge and five years for the false claim charge.

Additionally, he may be subjected to supervised release, restitution, and monetary penalties.

The final sentence will be determined by a federal district court judge, who will consider the U.S. Sentencing Guidelines and other statutory factors, according to DOJ.

U.S. Attorney Gary M. Restaino for the District of Arizona made the announcement.

The District of Arizona is composed of approximately 180 assistant United States Attorneys (AUSAs) and approximately 160 support staff members spread out into two large offices in Phoenix and Tucson, according to DOJ.