LAS VEGAS (KLAS) — A Las Vegas woman is accused of committing major fraud by using fake information to apply for six Paycheck Protection Program (PPP) loans totaling $1 million claiming her company paid out several million in employee wages.
Karen Chapon, also known as Karen Hannafious, 50 was charged with one count of bank fraud and one count of making false statements to a financial institution, according to the U.S. Attorney’s Office for the District of Nevada.
The government has executed seizure warrants recovering the majority of the nearly $600,000 in PPP loan proceeds that Chapon obtained in her alleged fraud, including more than $500,000 from the bank account of one of her companies and a Mercedes Benz SUV.
According to the complaint, Chapon made numerous false and misleading statements about her companies’ respective business operations and payroll expenses, and falsely denied that she had been convicted of a felony in the past five years. It also states that Chapon “submitted fake and altered documents, including fraudulent federal tax filings” for a company called Heavenly Tahoe Properties. The IRS had no record of tax returns for that company.
PPE loans, under the CARES Act, were designed to provide emergency financial assistance to small businesses so they could retain employees and keep afloat amid the COVID-19 pandemic.