Man Charged with Defrauding Elderly Homeowners and COVID-19 Relief Programs (Press Release, August 22, 2023)

Summary

A press release of the U.S. Attorney's Office for the Eastern District of Virginia, dated Tuesday, August 22, 2023, announcing the initial appearance of Howard Lee Stith Jr., 41, on charges of wire fraud, filing a false tax return, tax evasion and making false statements to a financial institution. The indictment alleges that from at least 2015 Stith obtained at least $1.5 million from elderly homeowners in the Richmond Metro area through overpriced slate roof repairs and evaded income tax of at least $575,000 for tax years 2018 through 2021. It also alleges that Stith obtained at least $112,000 in EIDL funds and at least $13,000 in unemployment insurance benefits to which Stith was not entitled. The case is Case No. 3:23-cr-110.

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PRESS RELEASE



Man Charged with Defrauding
Elderly Homeowners and COVID-
19 Relief Programs
Tuesday, August 22, 2023


For Immediate Release
U.S. Attorney's Office, Eastern District of Virginia

RICHMOND, Va. – A Freeman man had his initial appearance today on charges of wire
fraud, filing a false tax return, tax evasion, and making false statements to a financial
institution.

According to the indictment, Howard Lee Stith Jr., 41, allegedly perpetrated a scheme to
defraud elderly homeowners in the Richmond Metro area by appearing at their homes
and claiming that their slate roofs needed extensive repairs, which Stith offered to provide
on a price-per-foot or price-per-material basis. Thereafter, Stith purported to provide the
promised services, but, in truth, Stith performed minimal work of poor quality while
charging homeowners exorbitant fees. Allegedly, Stith targeted the same homeowners
over months and years, returning unsolicited and claiming the homeowners’ roofs needed
further repairs. To substantiate the excessive amounts he charged, Stith allegedly created
false invoices and misleading receipts, which he provided to various homeowners. From
at least 2015 through the present time, Stith is alleged to have fraudulently obtained at
least $1.5 million from elderly homeowners in connection with this scheme.

According to allegations in the indictment, Stith failed to report to the Internal Revenue
Service (IRS) the income he obtained from this scheme by filing a false tax return in 2018;
failing to file tax returns in 2019, 2020, and 2021; and taking affirmative acts to evade the
assessment of income tax between 2019 and 2021. Specifically, Stith allegedly directed
homeowners to pay him by personal check and then conducted a series of transactions
to convert the check into cash without making deposit records. Having thereby concealed
the nature and source of his income, Stith thereafter dealt heavily in cash. After learning
he was under federal investigation, Stith allegedly began directing homeowners to write
personal checks to others to further conceal his receipt of such payments. Through this
conduct, Stith evaded the assessment of income tax in the alleged amount of at least
$575,000 for tax years 2018 through 2021.

According to further allegations in the indictment, Stith also used cash from his roofing
scheme to make large payments on high end cars. When applying to finance some of
these vehicles with a local credit union, Stith is alleged to have prepared and provided
false tax returns that reported significantly more income than he had claimed in the
returns filed with the IRS for those same years. As a result, the credit union approved and
funded multiple loans totaling at least $130,000.

Finally, according to the allegations, after the onset of the COVID-19 pandemic, Stith
applied for and received relief funds to which he was not actually entitled. First, Stith
applied for multiple Economic Injury Disaster Loans (EIDL) on behalf of various businesses,
including a roofing business. These applications included materially false statements
about each business’s gross income and number of employees. Based on these material
misrepresentations, Stith obtained at least $112,000 in EIDL funds to which he was
allegedly not entitled. Stith also applied for and received at least $13,000 in
unemployment insurance benefits (UI), allegedly falsely claiming that he was not working,
not self-employed, and not receiving money from any source. It is alleged that Stith
received tens of thousands of dollars from elderly homeowners during the period in which
he falsely claimed entitlement to unemployment.

Stith is charged with wire fraud, filing a false tax return, evading the assessment of income
tax, failing to file income tax returns, and making false statements to a financial institution.
If convicted, he faces a maximum penalty of 30 years in prison. Actual sentences for
federal crimes are typically less than the maximum penalties. A federal district court judge
will determine any sentence after taking into account the U.S. Sentencing Guidelines and
other statutory factors.

Jessica D. Aber, U.S. Attorney for the Eastern District of Virginia; Kyo Dolan, Special Agent
in Charge of the U.S. Secret Service’s Richmond Field Office; Kareem A. Carter, IRS Criminal
Investigation Acting Special Agent in Charge of the Washington D.C. Field Office; Stanley
M. Meador, Special Agent in Charge of the FBI’s Richmond Field Office; Troy W. Springer,
Acting Special Agent in Charge, National Capital Region, U.S. Department of Labor, Office
of Inspector General; and Amaleka McCall-Brathwaite, Eastern Region Special Agent in
Charge for the Small Business Administration, Office of Inspector General, made the
announcement.

Assistant U.S. Attorneys Kaitlin G. Cooke and Kashan K. Pathan are prosecuting the case.
Combatting elder abuse and financial fraud targeted at seniors is a key priority of the
Department of Justice. Elder abuse is an intentional or negligent act by any person that
causes harm or a serious risk of harm to an older adult. It is a term used to describe five
subtypes of elder abuse: physical abuse, financial fraud, scams and exploitation, caregiver
neglect and abandonment, psychological abuse, and sexual abuse. Elder abuse is a serious
crime against some of our nation’s most vulnerable citizens, affecting at least 10 percent
of older Americans every year. Together with our federal, state, local and tribal partners,
the Department of Justice is steadfastly committed to combatting all forms of elder abuse
and financial exploitation through enforcement actions, training and resources, research,
victim services, and public awareness. This holistic and robust response demonstrates the
Department’s unwavering dedication to fighting for justice for older Americans.

Anyone who believes they have been harmed by Stith’s criminal actions may contact the
U.S. Attorney’s Office Victim Witness Coordinator by calling 804-819-7429.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the
Eastern District of Virginia. Related court documents and information are located on the
website of the District Court for the Eastern District of Virginia or on PACER by searching
for Case No. 3:23-cr-110.

An indictment is merely an accusation. The defendant is presumed innocent until proven
guilty.

Contact
USAVAE.Press@usdoj.gov

Updated August 22, 2023

Topics
CORONAVIRUS

ELDER JUSTICE

FINANCIAL FRAUD


Components
Federal Bureau of Investigation (FBI)
USAO - Virginia, Eastern


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