A San Antonio woman has admitted she helped stuff company payrolls with fake employees so businesses could snag lucrative set-aside HUBZone contracts, according to federal prosecutors. Barbara Sanders told FBI agents she fabricated timesheets and cooked up spreadsheets to make the sham hires look legit, authorities say. U.S. District Judge Orlando L. Garcia accepted her guilty plea on Feb. 6, 2026, and Sanders is scheduled to be sentenced on May 7.
How prosecutors say the scheme worked
Prosecutors say the conspiracy revolved around Aaron Sams, who pitched his business as a way for HUBZone companies to meet strict federal hiring rules. According to the U.S. Attorney's Office for the Western District of Texas, Sams and his co-conspirators rounded up friends and relatives to appear on company payrolls, set up email accounts, scrubbed resumes so these supposed employees could not easily be contacted, and then took kickbacks of about 20 percent of each bogus paycheck. The indictment alleges the seven defendants pulled in more than $2 million through the setup.
Sanders' plea and what she admitted
Sanders pleaded guilty to conspiracy to commit wire fraud and, according to the San Antonio Express-News, acknowledged receiving about $214,775 for filling out falsified time sheets and cranking out "work product" spreadsheets to back them up. She entered her plea before U.S. Magistrate Judge Henry Bemporad, which was later accepted by U.S. District Judge Orlando L. Garcia, and she remains free on a $30,000 unsecured bond. Her attorney told the paper she "regrets her role in this business."
How the HUBZone rules work
The HUBZone program is designed to steer federal contracting dollars into struggling neighborhoods by favoring small businesses that keep their main office inside a designated HUBZone and have at least 35 percent of their employees living in those areas, according to the Small Business Administration. When payrolls are padded with people who do not actually work or live where the rules require, it can undercut the program's core goal of helping economically distressed communities.
Investigation and agencies involved
Federal investigators say the case drew on help from several watchdog and investigative offices, including the SBA Office of Inspector General, the Department of the Air Force's Office of Special Investigations, the Defense Criminal Investigative Service and the Naval Criminal Investigative Service. That lineup, the U.S. Attorney's Office notes, reflects a cross-agency push to protect federal procurement programs. Authorities allege the scheme ran from about 2017 through March 2023, before the investigation culminated in indictments and a series of plea deals.
Who else is charged and what's next
Sanders is the third of seven defendants to plead guilty in the case. The San Antonio Express-News reports that Kristin Harrison and Jesus Rodriguez previously entered guilty pleas, and that a fourth defendant, Jonathan Adams, has agreed to plead under seal. Several others, including the alleged ringleader Aaron Sams and his wife, Beverly Smith, still face charges. If more plea agreements are not reached, some of the remaining co-defendants are scheduled to go to trial on June 22, 2026.
Legal outlook
The federal wire fraud statute, as outlined by Cornell Law School, allows for sentences of up to 20 years in prison for most violations. The general conspiracy statute, described by Cornell Law School, covers agreements to defraud the United States and carries separate penalties. Any eventual sentence will be guided by the U.S. Sentencing Guidelines and statutory factors, and judges can also impose restitution or forfeiture where proven losses exist. Sanders' plea agreement, however, reportedly does not require restitution.
