Illinois Woman Sentenced to Prison for Fraudulent Scheme Seeking Millions in COVID-19 Tax Credits
Summary
Lakeibia Fannin was sentenced on September 25, 2026 by U.S. District Judge Andrew P. Gordon to 13 months in prison, three years of supervised release and $1,455,835.24 in restitution for conspiring to defraud the United States with false COVID-19 tax credit refund claims, the Justice Department announced. According to court documents, Fannin conspired with Candies Goode-McCoy and others from June 2022 through November 2023 to file returns claiming false Employee Retention Credits and Sick and Family Leave Credits, seeking more than $3.5 million in refunds, of which more than $1.4 million was paid. The release says the proceeds went to vacations, a cruise, jewelry, designer clothes and a car. Goode-McCoy was sentenced in April 2026 to 54 months. The case was announced in the National Tax Enforcement Surge, which the release says brought actions against 76 defendants.
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Full text
An Illinois woman was sentenced on September 25, 2026, to 13 months in prison for conspiring to defraud the United States by making false claims for refunds based on COVID-19 tax credits. Between early September and October 14, federal prosecutors across the country participated in the Department’s first-ever National Tax Enforcement Surge. The surge of nationwide resources resulted in prosecutorial actions against 76 defendants whose alleged and proven crimes intended and estimated loss of revenue to the federal government of more than $490,000,000. The Tax Section announced this case among others pursued by the Justice Department’s National Fraud Enforcement Division, U.S. Attorneys’ Offices, and Internal Revenue Service, Criminal Investigation, that targeted tax fraud and related offenses. According to court documents and statements made in court, Lakeibia Fannin conspired with others, including Candies Goode-McCoy, from June 2022 through November 2023 to file tax returns seeking fraudulent refunds based on false Employee Retention Credits (“ERC”) and Sick and Family Leave Credits. Fannin and her businesses were not eligible to receive these refundable credits in the amounts claimed. In total, Fannin claimed more than $3.5 million in fraudulent refunds, of which more than $1.4 million were paid. Fannin used the proceeds for her personal benefit, including on vacations, a cruise, jewelry, designer clothes, and a car. In April 2026, Goode-McCoy was sentenced to 54 months in prison for her role in the scheme. In response to the COVID-19 pandemic and its economic impact, Congress authorized the ERC for small businesses to reduce the employment tax owed to the IRS. Congress also authorized the IRS to give a credit against employment taxes to reimburse businesses for the wages paid to employees who were on sick or family leave and could not work because of COVID-19. This credit was equal to the wages the business paid the employees during the sick or family leave, subject to a maximum amount. Fannin pleaded guilty to one count of conspiracy to defraud the government with respect to claims. In addition to the term of imprisonment, U.S. District Judge Andrew P. Gordon ordered Fannin to serve three years of supervised release and to pay $1,455,835.24 in restitution to the United States. Assistant Attorney General Colin M. McDonald of the Justice Department’s National Fraud Enforcement Division and First Assistant U.S. Attorney for the District of Nevada Sigal Chattah made the announcement. IRS Criminal Investigation and the Treasury Inspector General for Tax Administration investigated the case. Trial Attorney John C. Gerardi of the National Fraud Enforcement Division’s Tax Section and Assistant U.S. Attorney Richard Anthony Lopez of the District of Nevada prosecuted the case. On April 7, the Department of Justice announced the creation of the Fraud Division. The Fraud Division is laser-focused on investigating and prosecuting those who commit fraud against the American people. The Department’s work to combat fraud supports President Trump’s Task Force to Eliminate Fraud, a whole-of-government effort chaired by Vice President J.D. Vance to eliminate fraud, waste, and abuse within Federal benefit programs.
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