Nashville couple pleads guilty to COVID fraud scheme

Date: Aug. 12, 2024

Contact: [email protected]

Raleigh, NC - Joe Lewis Jefferson of Nashville, North Carolina, pled guilty for executing a scheme to defraud a program designed to help struggling North Carolinians stay in their homes during the COVID-19 pandemic. He faces up to 31 years in prison. On March 27, 2024, Jefferson's wife, Danyael Davis Jefferson, pled guilty to conspiracy to commit mail fraud for her role in the scheme.

According to information presented in court, Jefferson recruited others to falsely pose as landlords for properties located in Eastern North Carolina. In the names of these nominee landlords, Jefferson prepared and submitted fraudulent North Carolina Housing Opportunities and Prevention of Evictions (NC HOPE) loan applications for emergency rental assistance. When the applications were approved, NC HOPE mailed checks to addresses controlled by Jefferson. Jefferson traveled with the nominee landlords to area banks to negotiate the checks and split the proceeds. Jefferson and his co-conspirators were responsible for the submission of at least 44 fraudulent applications for rental assistance, resulting in the disbursement of approximately $279,000.

The NC HOPE Program administered federal COVID-19 relief funds and provided emergency rental assistance to North Carolina renters who faced eviction and homelessness during the pandemic. The Program allowed renters to submit an online application to apply for rental assistance. If approved, the Program paid the tenant's rent, in checks sent directly to the landlord, for up to 15 months of overdue or future rent payments.

Michael Easley, U.S. Attorney for the Eastern District of North Carolina, made the announcement after United States Magistrate Judge Robert T. Numbers, II accepted the plea. Sentencing will occur before United States District Judge James C. Dever, II, later this year.

The investigation is being conducted by IRS Criminal Investigation (IRS CI) and the U.S. Postal Inspection Service. Assistant U.S. Attorney Toby Lathan is prosecuting the case.

CI is the criminal investigative arm of the IRS, responsible for conducting financial crime investigations, including tax fraud, narcotics trafficking, money-laundering, public corruption, healthcare fraud, identity theft and more. CI special agents are the only federal law enforcement agents with investigative jurisdiction over violations of the Internal Revenue Code, obtaining a more than a 90 percent federal conviction rate. The agency has 20 field offices located across the U.S. and 12 attaché posts abroad.