Latisha Dudley, 51, and Timeeka Loud, 47, each admitted last week to aiding and assisting in the preparation of false tax returns, mail fraud, and theft of government funds. Dudley fraudulently claimed roughly $86 million in COVID-19-related tax credits, while Loud claimed about $23 million, prosecutors said.

Between May and October of this year, seven other people who worked with the two women also pleaded guilty to mail fraud and theft of government funds for their roles in the same schemes.

"Every dollar lost to fraud is a dollar that can't be used for a vital government program or service," U.S. Attorney David Metcalf said in a statement. "My office is committed to bringing crooks like Dudley and Loud to justice and protecting the public fisc."

According to court filings, Dudley recruited friends and family members between late 2021 and early 2025 to claim refunds for businesses they supposedly owned. Prosecutors said she knew most of those businesses had little or no actual operations, yet she prepared false quarterly employment tax returns that inflated the number of employees and wages paid and falsely claimed eligibility for pandemic tax credits.

In all, Dudley and others working under her direction prepared more than 680 fraudulent returns claiming approximately $86 million in credits. The IRS rejected some of the returns but issued refunds totaling about $7.9 million. Dudley directed her clients to pay her a share of their refunds and collected at least $1.2 million in preparation fees, which prosecutors said she spent on large quantities of luxury clothing and jewelry.

Loud ran a similar operation from 2022 through late 2023, recruiting friends and family to claim refunds for businesses they purportedly owned. She and her associates prepared more than 130 fraudulent returns claiming about $23 million in COVID-19-related credits. The IRS rejected some of those returns but paid out roughly $4.6 million. Loud typically charged clients 20% to 30% of their refunds and collected at least $1.2 million in fees, which prosecutors said she also used to buy luxury clothing and jewelry.

Loud pleaded guilty to nine counts of aiding and assisting in the preparation of false tax returns, 25 counts of mail fraud, and one count of theft of government funds. Dudley pleaded guilty to seven counts of aiding and assisting in the preparation of false tax returns, 27 counts of mail fraud, and one count of theft of government funds.

Both women are scheduled to be sentenced in February. Each count of aiding and assisting in the preparation of false tax returns carries a maximum penalty of three years in prison, each mail fraud count carries up to 20 years, and each count of theft of government funds carries up to 10 years.

The case is among a series of federal prosecutions targeting fraud against pandemic relief programs, which injected trillions of dollars into the economy through tax credits, loans, and direct payments. Investigators have repeatedly warned that the speed with which those programs were rolled out created openings for abuse, and that the losses ultimately come at the expense of the public services the money was meant to support.