Owner Of Online Luxury Baby Boutique Sentenced To 90 Months For Defrauding Covid-19 Relief Programs

DENVER - The United States Attorney's Office for the District of Colorado announces that Shambrica Washington, 39, now a resident of Parker, Texas, was sentenced to 90 months in prison to be followed by three years of supervised release, and restitution of $542,924.45 after being found guilty by a federal jury on 31 counts including wire fraud, bank fraud, money laundering, and false claims offenses.

According to facts established at trial, Washington obtained loans from the Small Business Administration for two Economic Injury Disaster Loans (EIDL) and from JP Morgan Chase for two Paycheck Protection Program (PPP) loans for a total of $485,749.00 between March of 2020 and July of 2020. During that time, Washington obtained the loans under two business names. One was "Tiny Toes and Tiaras," which was an online luxury baby boutique based in Colorado Springs. To obtain the fraudulent loans, Washington misrepresented how many people were employed by her businesses and the businesses' wages, revenues, and costs of operation. She used the funds to purchase a car, a custom-built home, pay for elective surgery, and pay credit card debt and other bills. She then applied for millions of dollars in additional loans, grants, and tax credits, including by applying for advance tax credits from the Internal Revenue Service and a $6 million grant through a Small Business Administration program intended for shuttered concert venues.

"People who steal taxpayer dollars for personal benefit can and will pay the price," said Acting United States Attorney for the District of Colorado Matt Kirsch. "Our office has and will continue to find people who have abused Covid-19 funds and prosecute them to the fullest extent of the law."

"Shambrica Washington fraudulently obtained PPP and EIDL designated to provide Americans financial relief during the COVID-19 pandemic," said Tom Demeo, Acting Special Agent in Charge, IRS Criminal Investigation Denver Field Office. "Washington's sentence demonstrates the federal government's commitment to holding individuals accountable who defrauded critical programs that served to provide aid for families and small businesses."

United States District Court Judge William J. Martinez presided over the trial. IRS Criminal Investigation and the FBI Denver Field Office conducted the investigation. Assistant United States Attorneys Craig Fansler and Taylor Glogiewicz handled the prosecution.

On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the department's response to the pandemic, please visit https://www.justice.gov/coronavirus.

On July 11, 2023, the Attorney General selected the District of Colorado's U.S. Attorney's Office to head one of five national COVID-19 Fraud Strike Force Teams. The Department of Justice established the Strike Force to enhance existing efforts to combat and prevent COVID-19 related financial fraud. The Strike Force combines law enforcement and prosecutorial resources and focuses on large-scale, multistate pandemic relief fraud perpetrated by criminal organizations and transnational actors, as well as those who committed multiple instances of pandemic relief fraud. The Strike Force uses prosecutor-led and data analyst-driven teams to identify and bring to justice those who stole pandemic relief funds. Additional information regarding the Strike Force may be found at https://www.justice.gov/opa/pr/justice-department-announces-results-nationwide-covid-19-fraud-enforcement-action.

Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice's National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.