Former Phoenix Anchor Jailed 10 Years in $63M COVID Fraud

A former Phoenix news anchor has been handed a 10-year prison sentence for her significant role in a massive $63 million scheme to defraud COVID-19 relief programs. Stephanie Hockridge, once a familiar face on local television, received her sentence on Friday following a jury’s conviction in June. Her husband and co-conspirator, Nathan Reis, had previously entered a guilty plea to similar charges in August.

A Decade for Deception

The US Justice Department confirmed that Hockridge and Reis jointly established a company called Blueacorn in April 2020. This firm was ostensibly created to assist small businesses and individuals in navigating the application process for Paycheck Protection Program (PPP) loans. These critical loans, designed to help keep businesses afloat during the pandemic, were guaranteed by the US Small Business Administration (SBA).

However, federal prosecutors revealed a darker truth: Hockridge, who worked at ABC15 television station from 2011 to 2018, along with Reis and other collaborators, engaged in widespread fraud. They systematically “fabricated documents, including payroll records, tax documentation and bank statements” to illicitly secure over $63 million in PPP loans. Beyond the initial fraud, the conspirators also “charged borrowers kickbacks based on a percentage of the funds received,” according to the Justice Department.

Exploiting Relief Programs

The group operated a specialized offering dubbed the “VIPPP” service. While marketed as a premium service to guide clients through PPP loan applications, its true purpose was to coach borrowers on how to submit false information. Hockridge was also instrumental in recruiting a network of referral agents. These agents were tasked with pushing fraudulent applications, a move designed to maximize kickbacks from clients and boost the conspirators’ share of the SBA lender fees.

Hockridge’s conviction by a jury for conspiracy to commit wire fraud occurred approximately two months before her husband, Nathan Reis, admitted guilt to the identical charge. Their coordinated efforts underscore the depth of the scheme that siphoned vital resources intended for struggling businesses during an unprecedented crisis.

Congressional Spotlight and Damning Evidence

The scope of Blueacorn’s operations and the alleged fraud drew significant attention. In 2022, a congressional report cast a harsh light on the company, revealing that Blueacorn had processed loans totaling more than $1 billion in taxpayer money. The report highlighted the extraordinary volume of loans facilitated by Blueacorn’s partner lenders, which collectively issued nearly three times more PPP loans in 2021 than financial giants JP Morgan Chase and Bank of America combined, as reported by AZ Family.

The congressional inquiry also unearthed incriminating evidence, including Slack messages from Hockridge herself. In one message, she explicitly instructed colleagues to “delete them,” referring to undisclosed communications. Another message revealed her dismissive attitude towards smaller, non-VIPPP loans, where she wrote, “who [expletive] cares,” adding, “We’re not the first bank …” These messages painted a clear picture of an organization prioritizing profit over ethical conduct and the legitimate needs of small businesses.

The sentencing of Stephanie Hockridge serves as a stark reminder of the severe consequences awaiting those who exploit public trust and critical relief programs for personal gain. Her decade-long incarceration underscores the federal government’s commitment to prosecuting individuals who engaged in widespread fraud during the pandemic.

Source: The Guardian