A Cook County postal worker was charged with crimes related to Paycheck Protection Program loan fraud, as announced by Attorney General Kwame Raoul this past week. Kelly Newman, age 37 and a resident of Chicago, supposedly received a total of $40,000 across two fraudulent PPP loans while still drawing a salary from the U.S. Postal Service.
The legal ramifications Newman faces include three counts of theft by deception over $10,000 and three counts of loan fraud, each of which are Class 2 felonies that could lead to up to seven years behind bars. In addition, Newman is up against four counts of forgery, which are Class 3 felonies and could result in up to a five-year sentence. According to the Attorney General's office, her next court date is scheduled for May 13.
In a statement, Raoul expressed his disappointment, stating, "It is disappointing anyone employed by the federal government would take advantage of the federal COVID-era assistance programs." He continued with his commitment to accountability: "These loans were intended to help small businesses and unemployed Americans survive the pandemic. I will continue to hold public workers accountable for abusing these critical programs to line their own pockets."
The charges stem from Newman's alleged false claims that she owned a non-existent business to secure the PPP loans – $20,000 in July 2020 and another $20,000 in January 2021. This case came to light through an initial investigation by the U.S. Postal Service - Office of the Inspector General (OIG) who were investigating possible workers' compensation fraud. "The U.S. Postal Service paid $1.5 billion in workers' compensation costs in fiscal year 2024," Special Agent in Charge Dennus Bishop of the USPS OIG's Central Area Field Office remarked. Bishop also emphasized the OIG's commitment to integrity: "However, a small percentage abuse the system and cost the Postal Service millions of dollars in fraudulent claims and enforcement costs,” said Special Agent in Charge Dennus Bishop, Central Area Field Office, U.S. Postal Service - OIG. “Today’s charges send a clear message that the USPS OIG and the Illinois Attorney General’s Office remain committed to safeguarding the integrity of benefit programs and ensuring the accountability and integrity of U.S. Postal Service employees."
These charges are among the latest efforts by Attorney General Raoul's office to address fraudulent activities related to government assistance during the pandemic. Dozens of individuals have been prosecuted for PPP loan fraud, and his office has referred other cases to state attorneys for further assessment. Despite the charges, the public is reminded by the Attorney General's office that the defendants are presumed innocent until proven guilty in a court of law. Assistant Attorneys General Haley Bookhout and Mara Somlo are representing the Public Integrity Bureau in the prosecution of these cases.
