City of Mount Vernon employee charged in $ 1.6 million COVID-19 relief program
A Mount Vernon union official, his daughter and a former town resident were arrested by the FBI on Tuesday for running a nearly $ 1.7 million pandemic relief fraud program by submitting claims to over 300 people to claim federal loans for non-qualifying businesses.
Andrea Ayers, a civilian employee of the Mount Vernon Police Department, and Alicia Ayers, who runs a travel agency and a financial services company, were arrested in Mount Vernon.
Traci Proctor, who also worked in the Mount Vernon city government ten years ago, has been arrested in Georgia. All three are charged with wire fraud, aggravated identity theft and misrepresentation in connection with the scheme that defrauded the Small Business Administration’s economic disaster loan program. They face up to 20 years in prison.
According to federal prosecutors, $ 1.69 million was paid under the program and many beneficiaries paid between $ 1,000 and $ 5,000 to the defendants. Text messages reviewed by FBI agents showed the women concocting bogus businesses with certain candidates. One candidate was promised $ 1,000 for each person he recruited into the program, and he said he would only share with people he knew.
They would “laugh straight to the bank,” she wrote.
“As alleged, the defendants conspired to defraud the SBA by submitting disaster loan and grant applications for non-existent companies,” US lawyer Audrey Strauss said when announcing the arrests. “In doing so, they have stolen funds intended for the many small businesses that are struggling due to the COVID-19 pandemic.”
The two Ayers appeared before US Magistrate Judith McCarthy in White Plains and were released on $ 150,000 bail. Proctor has been released on bail following an appearance in federal court in Georgia and is scheduled to appear before McCarthy on Thursday.
Royce Russell, an attorney for Andrea Ayers, declined to comment. Alicia Ayers’ lawyer could not be reached immediately.
The News / Lohud Journal last month reported more than 400 city residents who received the maximum EIDL advances of $ 10,000 which required them to own businesses with at least 10 employees, although most did not appear to have any. such companies.
The grants were different from the EIDL loans because they were advances that did not have to be repaid. Companies were to receive $ 1,000 per employee, up to $ 10,000.
In many cases, the women started businesses that didn’t exist and in others, they applied for businesses with fewer than 10 employees, according to the U.S. Attorney’s Office.
Many of the beneficiaries who gave the Ayers their pedigree and bank details felt the money was for homeowners or tenants, not that they should own businesses.
A claimant who learned of this and tried to stop the claim reported to authorities what had happened and his claim was denied.
Andrea Ayers, 54, whose father is a retired Mount Vernon Police detective, is the CSEA’s local union representative for the Town of Mount Vernon employees and also runs a catering business. She was believed to have spread the word about the grant money among city employees, at least 27 of whom received maximum advances of $ 10,000.
She and her 34-year-old daughter each received pandemic relief money for their businesses last year – $ 6,000 for Andrea and $ 1,000 for Alicia – as did at least three of their own. relatives.
Officials from the U.S. Attorney’s Office and the FBI failed to admit to Journal News in the fall that an investigation was underway. But when news of the program became public and it could have taken place at City Hall, Mayor Shawyn Patterson-Howard asked employees who had received pandemic relief money to report it. to city officials.
Seventeen employees did and city officials reported it to the FBI. The list has not been made public. Patterson-Howard made no immediate comment on the arrests Tuesday afternoon, but said Andrea Ayers was not among those who said they received federal money.
Police Commissioner Glenn Scott said Ayers was suspended without pay.
In phone conversations with The Journal News / lohud since the fall, the two Ayers women have denied any wrongdoing.
But the criminal complaint included a text conversation from June 24, 2020 in which they talked about lining up people for the advances.
“Send me what you need from people so I can get the information and put it in place,” Andrea wrote.
Alicia replied that she shouldn’t be telling too many people, to “hold on”, “because it’s someone else’s activity that I stole.” Andrea said OK, but wondered why.
“If I don’t pay it, it’s like I’m stealing it,” Alicia replied.
Alicia told Andrea it was ok to line up people in Queens and texted her the genealogy information she needed from each candidate.
Andrea asked if they could apply for people outside New York because “(name withheld) will get the (curse)”.
Alicia then explained to her how the cash advance was different from the loan and did not have to be repaid.
“But how do you know they won’t ask you?” »Andrea asked.
“Because it’s a grant. The grants are free.”
In addition to indicating the number of employees they had, applicants’ businesses had to be created before January 2020 and have certain income in the previous year to be eligible for the money. But of the 45 recipients interviewed by the FBI, none said the defendants asked for any of these details about their businesses.
The 315 applications from June 22 to July 9 – which requested more than $ 3 million in grants – were from computers in Andrea Ayers’ home, an apartment in Stamford, Connecticut, where Alicia Ayers lives part-time, and from computers in DeKalb County, Georgia, where Proctor lives. The claims were supposed to identify anyone who helped the owner of the business, but none of the names of the defendants were ever included.
A national SBA advance grant database examined by The Journal News appears to corroborate what Alicia Ayers was telling her mother about someone else who started the scam. In May and early June – before they allegedly started applying for the maximum grants – 85 people in Mount Vernon received the $ 10,000, with no clear evidence that they had businesses.
The program distributed 5.8 million grants totaling $ 20 billion nationwide and ran out of money in mid-July.