A local business owner from Stafford has entered a plea of guilty to conspiracy to commit wire fraud in a case involving over $400,000 obtained through federal relief programs meant to aid those financially affected by the COVID-19 pandemic. According to the U.S. Attorney's Office, Kristen Fenrick, 52, admitted to submitting fraudulent claims through the Paycheck Protection Program (PPP) and Economic Injury Disaster Loan (EIDL) Programs as part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act.
From the span of March 2020 to February 2022, Fenrick falsified applications specifying her business, Klearly Kristen Inc., which sells jewelry and accessories purported to employ a greater number of workers than actual and claimed inflated monthly payroll expenses; the fraud not only encompassed these inflated claims but also was substantiated by fraudulent tax documents provided by Fenrick and an unnamed co-conspirator. As a result of the fraudulent application, the business received a PPP loan of $405,340 in June 2020; however, Fenrick used part of these funds for personal expenses, such as leasing a luxury car instead of covering payroll as the loan program intended, authorities report.
In her plea, Fenrick also copped to making multiple false EIDL applications on behalf of her business and other nonexistent entities, managing to secure a $10,000 advance for Klearly Kristen. In total, the fraudulent actions of Fenrick led to a loss of $415,340 for the federal relief programs that had been established to help small businesses stay afloat during an unprecedented health crisis.
U.S. District Judge Alfred H. Bennett has scheduled sentencing for January 30, 2025, and Fenrick faces up to five years in prison along with the possibility of a $250,000 fine in addition to her criminal behavior Fenrick is now out on bond until the sentencing date. The SBA-Office of the Inspector General, along with the Secret Service, spearheaded the investigation, and Assistant U.S. Attorney Shirin Hakimzadeh is in charge of the prosecution.
