Federal prosecutors say an Arizona woman tried to turn the pandemic into a personal payday, pleading guilty Thursday in a tax-refund scheme that sought more than $7.7 million in COVID payroll credits using phantom employees and bogus returns.
Regina Durkin, of New River, admitted she conspired with others to file fraudulent quarterly employment tax returns that claimed pandemic-era relief credits that were meant to keep real workers on the job during the COVID emergency.
Federal prosecutors lay out the fraud
According to the U.S. Department of Justice, Durkin pleaded guilty to one count of conspiracy to file false claims. Prosecutors say she and her co conspirators submitted 14 fake quarterly employment tax returns that requested a total of $7,736,421 in refunds by claiming the Employee Retention Credit and the paid sick and family leave credit for businesses that did not operate and reported no payroll at all.
Investigators issue a blunt warning
“Regina Durkin chose to steal $7.7 million from the American public through deliberate fraud, and now faces the full weight of a felony conviction,” IRS Criminal Investigation Phoenix Field Office Acting Special Agent in Charge Scott Brown said, per the U.S. Department of Justice. Authorities say the filings listed companies that had zero employees and paid no wages, and that the case was investigated by IRS Criminal Investigation and prosecuted in the District of Arizona. The message between the lines is pretty simple: fake workers can lead to very real criminal charges.
Part of a wider enforcement push
The plea comes as federal officials step up efforts to chase down pandemic relief fraud, consolidating and expanding enforcement this year through a National Fraud Enforcement Division that is intended to focus resources on schemes that abuse benefit and tax programs, legal analysts note. Coverage of related prosecutions shows a steady drumbeat of pandemic era credit scams and guilty pleas across the country, including a Peoria tax preparer who admitted to seeking roughly $1.8 million in fraudulent refunds, as reported in Peoria tax man cops to $1.8 million COVID refund scam.
Sentencing and legal exposure
Durkin is scheduled to be sentenced on September 11, 2026, and faces a statutory maximum of 10 years in prison, although the actual sentence will be set by a federal judge after considering the U.S. Sentencing Guidelines, the Tampa Free Press reports. Trial Attorneys Robert Kemins and Matthew Hoffman of the Justice Department’s Criminal Division and Assistant U.S. Attorney Matthew Williams for the District of Arizona are handling the prosecution.
Authorities are still looking for tips. Anyone with information about suspected pandemic relief fraud or false payroll filings can find reporting guidance through IRS Criminal Investigation. Internet enabled schemes can also be reported to the FBI’s online portal at IC3.gov.
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