Superseding Indictment - US v. Reis & Hockridge (Blueacorn)

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0 R | G | N A L IN THE UNITED STATES DISTRICT COURT

LYN

FOR THE NORTHERN DISTRICT OF TEXAS
FORT WORTH DIVISION

UNITED STATES OF AMERICA

V. No. 4:24-CR-287-O
[Supersedes Indictment returned on
NATHAN REIS (01) November 14, 2024]

STEPHANIE HOCKRIDGE (02)
a/k/a “Stephanie Reis”

SUPERSEDING INDICTMENT

The Grand Jury charges:
At all times material to this Superseding Indictment:

Background
l. The Coronavirus Aid, Relief, and Economic Security (“CARES”) Act was a
federal law enacted in or around March 2020 and designed to provide emergency
financial assistance to the millions of Americans who were suffering the economic effects
caused by the COVID-19 pandemic. One source of relief provided by the CARES Act
was the authorization of forgivable loans to small businesses for job retention and certain
other expenses, through a program called the Paycheck Protection Program (“PPP”).
2. In order to obtain a PPP loan, a qualifying business submitted a PPP loan
application, which was signed by an authorized representative of the business. The PPP
loan application required the business (through its authorized representative) to
acknowledge the program rules and make certain affirmative certifications in order to be

eligible to obtain the PPP loan. In the PPP loan application (Small Business

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Administration (“SBA”) Form 2483), the small business (through its authorized
representative) was required to provide, among other things, its: (a) average monthly
payroll expenses; and (b) number of employees. These figures were used to calculate the
amount of money the small business was eligible to receive under the PPP. In addition,
businesses applying for a PPP loan were required to provide documentation confirming
their payroll expenses.

3. A PPP loan application was processed by a participating lender. While it was the
participating lender that funded the loan, the loan was 100 percent guaranteed by the
SBA. Data from the loan application, including information about the borrower, the total
amount of the loan, and the listed number of employees, was transmitted by the lender to
the SBA in the course of processing the loan. In return for processing PPP loans, the SBA
paid lenders a processing fee.

4. PPP loan proceeds were required to be used by the business on certain permissible
expenses, such as payroll costs, interest on mortgages, rent, and utilities. The PPP
allowed the interest and principal on the PPP loan to be entirely forgiven if the business
spent the loan proceeds on these expense items within a designated period of time and
used a defined portion of the PPP loan proceeds on payroll expenses.

The Defendants, Related Entities, and Individuals

5. Lender-1 was a Community Development Financial Institution (“CDFI’)
headquartered in Phoenix, Arizona and a PPP lender.

‘

6. Lender-2 was a CDFI headquartered in Bedford, Texas and a PPP lender.

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7. Bank-1 was a financial institution headquartered in Happy, Texas whose deposits
were insured by the Federal Deposit Insurance Corporation. Bank-1’s computer servers
that stored records of bank transactions were located in the Northern District of Texas. In
2021, Bank-1 received funds sent from the Federal Reserve Bank into an account held by
Lender-2, which was then disbursed to fund PPP loans.

8. Blueacorn refers to a number of entities that were used by the defendants in 2020
and 2021 to process PPP loans. Beginning in 2021, Blueacorn collected and reviewed
PPP loan applications as a lender service provider on behalf of Lender-1 and Lender-2.
9. Nathan Reis lived in Arizona and co-founded and co-owned Blueacorn. Reis also
owned other companies, including Juuice Inc. and Juuice LLC.

10. Stephanie Hockridge a.k.a. Stephanie Reis lived in Arizona and co-founded and
co-owned Blueacorn. She also owned a company called Body Politix LLC. Hockridge
and Reis were married.

11. | James Flores lived in Arizona and was a business partner of Reis and Hockridge.

12. | Coconspirator-1 was an entrepreneur who knew Reis and Hockridge.

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Count One
Conspiracy to Commit Wire Fraud
(Violation of 18 U.S.C. § 1349 (18 U.S.C. § 1343))

13. Paragraphs 1-12 of this superseding indictment are realleged and incorporated.

14. From in or about April 2020, through in or about May 2021, in the Fort Worth
Division of the Northern District of Texas and elsewhere, defendants Nathan Reis and
Stephanie Hockridge, along with others known and unknown, did knowingly and
willfully combine, conspire, confederate, and agree to commit wire fraud, that is, to
devise and intend to devise a scheme and artifice to defraud and to obtain money and
property by means of materially false and fraudulent pretenses, representations, and
promises, and for the purpose of executing the scheme and artifice and attempting to do
so, caused to be transmitted by means of wire communications in interstate and foreign
commerce, writings, signs, signals, pictures, and sounds, in violation of 18 U.S.C.

§ 1343.

Purpose of the Conspiracy

15. | The purpose of the conspiracy was for the defendants and their coconspirators to
unlawfully enrich themselves by submitting and causing the submission of false and
fraudulent applications for forgivable PPP loans.

Manner and Means of the Conspiracy and Scheme to Defraud

16. | The manner and means by which Reis, Hockridge, and their coconspirators
sought to accomplish the object and purpose of the conspiracy included, among other

things, the following:

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a. Beginning in or around April 2020, Reis, Hockridge, and their
coconspirators began submitting fraudulent applications for PPP loans for
themselves and their businesses. Reis, Hockridge, and their coconspirators
fabricated tax documents, doctored bank statements, and made other
material misrepresentations in order to deceive lenders and the SBA into
issuing loans in amounts for which applicants were not eligible.

b. Beginning in or around April 2020, Reis, Hockridge, and others founded
Blueacorn, purportedly to assist small businesses and individuals in
obtaining PPP loans. In order to obtain larger loans for certain PPP
applicants, Reis, Hockridge, and their coconspirators fabricated
documents, including payroll records, tax documentation, and bank
statements. Reis and Hockridge charged borrowers a kickback based on a
percentage of their loans that were funded.

c. In 2020, Reis and Hockridge submitted and facilitated the submission of
PPP loan applications through various lenders, including Lender-1.

d. Beginning in or around October 2020, Reis, Hockridge, and others
expanded Blueacorn’s operations through a lender service provider
agreement (“LSPA”) with Lender-2. Under the LSPA, Blueacorn collected
and reviewed applications from potential borrowers on behalf of Lender-2
and worked with Lender-2 to submit applications to the SBA. In or around

April 2021, Blueacorn entered a similar LSPA with Lender-1. Under these

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agreements, Blueacorn received a percentage of the fees the SBA paid to
Lender-1 and Lender-2 for approved PPP loans. Reis, Hockridge, and their
coconspirators submitted and caused to be submitted PPP loan applications
that they knew contained materially false information in order to make
more money.
e. Reis, Hockridge, and their coconspirators also made money through a

Blueacorn program called “VIPPP” in which Hockridge and others offered
a personalized service to help potential borrowers complete PPP loan
applications. Reis and Hockridge recruited coconspirators to work as
VIPPP referral agents and coach borrowers on how to submit false PPP
loan applications. In exchange for their service, Reis, Hockridge, and their
coconspirators charged VIPPP borrowers fees based on a percentage of
their loans that were funded. In order to obtain a greater volume of
kickbacks from borrowers and fees from the SBA, Reis, Hockridge, and
their coconspirators submitted PPP loan applications that they knew
contained materially false information.

17. Reis, Hockridge, and their coconspirators also took the following steps, among

others, to carry out their conspiracy and scheme to defraud:

a. Beginning in or about April 2020, Reis created and submitted PPP loan

applications at multiple potential lenders containing fabricated tax

documents that falsely represented payroll that Juuice Inc. paid employees,

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including Reis and Hockridge. Based on their misrepresentations, Reis and
Hockridge obtained a PPP loan of around $69,870 on behalf of Juuice Inc.
from one of the lenders, which they used to pay themselves and another
purported employee.

b. In or about June 2020, Reis submitted a materially false PPP loan
application on behalf of Juuice LLC. As part of this application, Reis
fabricated a tax document falsely claiming that Juuice LLC made over
$118,000 in profit in 2019. In fact, several months later, Reis stated in an
email that Juuice LLC did not file taxes in 2019 because “Juuice LLC was
not active in 2019.” Based on this and other misrepresentations, Reis
obtained a loan of around $20,832 on behalf of Juuice LLC.

c. In or about June 2020, Hockridge, with the help of Reis, submitted a
materially false PPP loan application for Body Politix LLC (“Body
Politix”). The application falsely stated that Body Politix was a software
company and had a net profit of $110,470 in 2019. Based on this and other
misrepresentations, Hockridge obtained a loan of $19,832 on behalf of
Body Politix.

d. In or about February 2021, Hockridge and Reis, used materially false
representations to apply for a second draw PPP loan for Body Politix. The
application falsely stated that Body Politix experienced a 25 percent

reduction in gross receipts between the second quarter of 2019 and the

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second quarter of 2020, a reduction from $27,618 in 2019 to $17,950 in
2020. Based on this and other mniseepresentations, Hockridge obtained a
loan of around $20,832 on behalf of Body Politix. To fund this loan,
Lender-2 received funds into its account at Bank-1, and Bank-1 then
transferred the funds electronically using interstate wires to Hockridge’s

bank account, as described in Count Four.

e. In or about July 2020, Flores, with the help of Reis and other coconspirators,

submitted a materially false PPP loan application for Flores as a sole
proprietor. The application included a doctored bank statement to
misrepresent that Flores had a sole proprietorship apart from the company
that Flores owned. Reis knew the bank statement was doctored. Reis also
created a fake tax document purporting to show that a company paid Flores
over $106,000 in 2019. This loan was not funded.

In or about August 2020, Reis and Hockridge helped Coconspirator-1
submit a materially false PPP loan application. Although Coconspirator- 1
told Reis that Coconspirator-1 did not operate a sole proprietorship, Reis
told Coconspirator-1 that they would state on the application that
Coconspirator-1 would earn $100,000 in 2020. Based on this and other
misrepresentations, Coconspirator-1 obtained a loan of around $20,832 in

his own name.

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g. From in or about January 2021 through in or about March 2021, Reis and
Hockridge helped Coconspirator-1 submit three materially false PPP
applications to Lender-1, through which Coconspirator-1 obtained loans
totaling over $300,000. In one of the applications, Coconspirator-1 obtained
a loan of over $136,000 for an entity that did not have employees. Reis sent
Coconspirator-1 a template of a payroll report and told Coconspirator-1 to
fill it in with the names of Coconspirator-1’s friends, knowing that they were
not real employees. Reis told Coconspirator-1 to falsely claim that each
“employee” earned over $100,000.

h. Similarly, in a second application for a different entity, Coconspirator-1
obtained a loan of over $145,000 by falsely stating that entity had
employees.

i. Ina third application, Coconspirator-1 obtained a loan of around $20,832 by
falsely stating that Coconspirator-1 had an Amazon business that earned
over $100,000 in 2020.

j. To fund these three loans for Coconspirator-1, Lender-2 received funds into
its account at Bank-1, and Bank-1 then transferred the funds electronically
using interstate wires to Coconspirator-1’s bank account, as described in
Counts Two, Three, and Five.

All in violation of 18 U.S.C. § 1349 (18 U.S.C. § 1343).

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Counts Two — Five
Wire Fraud
(Violation 18 U.S.C. §§ 1343 and 2)

18. Paragraphs 1-12 of this superseding indictment are realleged and incorporated.
19. | Onor about the dates set forth below, in the Northern District of Texas and
elsewhere, the defendants, Nathan Reis and Stephanie Hockridge, along with
Coconspirator-1 and others known and unknown, aiding and abetting each other,
knowingly devised and intended to devise the scheme to defraud described in
paragraphs 15 through 17, and to obtain money and property by means of materially
false and fraudulent pretenses, representations, and promises, and for the purpose of
executing such scheme, caused to be transmitted by means of interstate and foreign

wire, the communications listed below, each constituting a separate count:

Count Date Description of Wire

Bank transaction containing fraudulently acquired PPP funds sent
2 9/17/2021 from Bank-1 in the Northern District of Texas to Coconspirator-1
outside the state of Texas

Bank transaction containing fraudulently acquired PPP funds sent
from Bank-1 in the Northern District of Texas to Coconspirator- 1

3 3/1/2021 outside the state of Texas
Bank transaction containing fraudulently acquired PPP funds sent
4 3/3/2021 from Bank-1 in the Northern District of Texas to Hockridge and

her bank outside the state of Texas

Bank transaction containing fraudulently acquired PPP funds sent
5 3/10/2021 from Bank-1 in the Northern District of Texas to Coconspirator-1
outside the state of Texas

All in violation of 18 U.S.C. §§ 1343 and 2.

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Forfeiture Notice
(18 U.S.C. § 981(a)(1)(C) and 28 U.S.C. § 2461(c))

20. The allegations of this superseding indictment are hereby realleged and by this
reference fully incorporated herein for the purpose of alleging forfeiture to the United
States of America of certain property in which the defendants, Nathan Reis and
Stephanie Hockridge, have an interest.

21. Upon conviction of the offenses in violation of Title 18, United States Code,
Sections 1343 and 1349, as alleged in this superseding indictment, the defendants,
Nathan Reis and Stephanie Hockridge, shall forfeit to the United States of America,
pursuant to Title 18, United States Code, Section 981(a)(1)(C) and Title 28, United States
| Code, Section 2461(c), any property, real or personal, which constitutes or is derived
from proceeds traceable to the offenses.
22.  Ifany of the property described above, as a result of any act or omission of the
defendants:

a. cannot be located upon the exercise of due diligence;

Ds has been transferred or sold to, or deposited with, a third party;
| c. has been placed beyond the jurisdiction of the court;

d. has been substantially diminished in value; or

S, has been commingled with other property which cannot be divided without
difficulty,

the United States of America shall be entitled to forfeiture of substitute property pursuant

to Title 21, United States Code, Section 853(p), as incorporated by Title 28, United States

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Code, Section 2461(c).
All pursuant to 18 U.S.C. § 981(a)(1)(C), 21 U.S.C. § 853, and 28 U.S.C.

§ 2461(c).

A TRUE BILL.

aVeve

FOREPERSON

CHAD E. MEACHAM

ACTING UNITED STATES ATTORNEY

MATTHEW WEYBRECHT

Assistant United States Attorney

State Bar of Texas No. 24102642
Telephone: 817-252-5200

Fax: 817-252-5455

Email: matthew.weybrecht@usdoj.gov

fbx bo

PHILIP TROUT

Acting Assistant Chief
Fraud Section

U.S. Department of Justice

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ZEA Le

ELIZABETH CARR

RYAN MCLAREN

Trial Attorneys

Money Laundering and Asset Recovery Section

U.S. Department of Justice

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IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF TEXAS
FORT WORTH DIVISION

THE UNITED STATES OF AMERICA

NATHAN REIS (01)

STEPHANIE HOCKRIDGE (02)
a/k/a “Stephanie Reis”

SUPERSEDING INDICTMENT

18 U.S.C. § 1349 (18 U.S.C. § 1343)
Conspiracy to Commit Wire Fraud
Count |

18 U.S.C. §§ 1343 and 2
Wire Fraud
Counts 2 - 5

18 U.S.C. § 981(a)(1)(C) and 28 U.S.C. § 2461(c)
Forfeiture Notice

——.

A true bill rendered )

DALLAS FOREPERSON
)

Filed in open court this An day of May, 2025.

SAWS

UNITED STATES MAGISTRATE JUDGE
District Court Number: 4:24-CR-287-O

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