Indictment — United States v. John Richard Stidolph and Lora Lee Stidolph, Southern District of Iowa

Summary

A grand jury indictment in United States of America v. John Richard Stidolph and Lora Lee Stidolph, Case 4:21-cr-00136-RGE-SHL, filed October 13, 2021 as Document 2 in the U.S. District Court for the Southern District of Iowa. Counts 1-2 (John Richard Stidolph) and Count 3 (Lora Lee Stidolph) charge wire fraud under 18 U.S.C. § 1343; Counts 4-7 and Count 8 charge false statements under 18 U.S.C. § 1001(a)(2). The indictment alleges that March 30, 2020 EIDL applications for Mine LLC, One Nation LLC and Addition Doctors reported gross revenue of $41,638,000, $49,778,000 and $307,416,000, and that the SBA wired $59,900, $149,900 and $149,900. It alleges the proceeds funded personal credit card payments and trading in a TD Ameritrade account, and that Cabin LLC, named on March 2021 applications, was not a company. The signature block names Acting United States Attorney Richard D. Westphal.

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“Indictment — United States v. John Richard Stidolph and Lora Lee Stidolph, Southern District of Iowa.” Original at archive.org. Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/indictment-no-4-21-cr-00136-dkt-2-e2824a1b2b/, SHA-256 35f5298f9535bdbb1e303ee5aded5a83adbd5b3932641244792e666b8c2400d2.

Full text

Case 4:21-cr-00136-RGE-SHL Document 2 Filed 10/13/21 Page 1 of 12

RECEIVED
OCT 1 3 2021
IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF IOWA CLERK OF DISTRICT COURT
SOUTHERN DISTAtCT OF IOWA

)
UNITED STATES OF AMERICA, ) Criminal No. 4:21-cr-136
)
V. ) INDICTMENT
)
JOHN RICHARD STIDOLPH and ) T. 18 U.S.C. § 1001(a)(2)
LORA LEE STIDOLPH, ) T. 18 U.S.C. § 1343
)
Defendants. )
)

THE GRAND JURY CHARGES:

Introduction

At all times material to this indictment:

1. The defendants, JOHN RICHARD STIDOLPH and LORA LEE

STIDOLPH are married and residents of Woodward, Iowa, in the Southern District

of Iowa.

2. JOHN RICHARD STIDOLPH incorporated and owns One Nation

LLC and Mine LLC, companies that purport to sell household supplies through

Amazon.com.

3. JOHN RICHARD STIDOLPH incorporated Addition Doctors,

Inc., a home remodel contractor business. JOHN RICHARD STIDOLPH and LORA

LEE STIDOLPH are co-owners of Addition Doctors, Inc.

4. The COVID-19 Economic Injury Disaster Loans (hereafter

"EIDL") support small business' recovery from the COVID-19 disaster's economic
1
Case 4:21-cr-00136-RGE-SHL Document 2 Filed 10/13/21 Page 2 of 12

impact by providing capital.

5. The EIDL is a direct loan process in which the borrower receives

money directly from the United States Treasury as directed by the U.S. Small

Business Administration (hereafter "SBA").

6. The EIDL process is designed to get money to the borrower as

rapidly as possible. Prospective borrowers apply through an SBA web portal. The only

financial information requested is gross revenues and cost of goods sold for the

twelve-month period prior to the date of the disaster - January 31, 2020. The gross

revenue and cost of goods amounts reported by the borrower determine if the SBA

will approve the loan and the amount of the loan received by the borrower. The gross

revenue and cost of goods information reported by the borrower are material to

whether the SBA will approve the loan and the amount of the loan received by the

borrower.

7. On each EIDL application a borrower must certify that the

information provided to the SBA is true and correct.

8. The EIDL Loan Authorization and Agreement, which is signed by

each borrower, states that the borrower will use all the proceeds of the EIDL solely

as working capital to alleviate the economic injury caused by the disaster. Examples

of working capital include payroll, rent, and materials costs for the business.

The Scheme and Artifice to Defraud

9. From at least on or about March of 2020, and continuing through

at least on or about May 2021, in the Southern District of Iowa and elsewhere, JOHN
2
Case 4:21-cr-00136-RGE-SHL Document 2 Filed 10/13/21 Page 3 of 12

RICHARD STIDOLPH and LORA LEE STIDOLPH, defendants herein, knowingly

devised, intended to devise, and participated in a scheme and artifice to defraud the

SBA, and to obtain money from the SBA by means of materially false and fraudulent

pretenses, representations, and promises, and by intentional concealment of material

facts.

10. It was part of the scheme that on March 30, 2020, JOHN

RICHARD STIDOLPH applied for a $60,000 EIDL from the SBA in the name of Mine

LLC. On the application, he falsely reported Mine LLC's gross revenue as $41,638,000

and the cost of goods sold at $14,167,000 for the twelve-month period ending January

31, 2020. JOHN RICHARD STIDOLPH electronically signed the loan application

and certified the information was true and correct, knowing the information was not

true and correct and that the gross revenue and cost of goods sold information was

false.

11. It was further part of the scheme to defraud that JOHN

RICHARD STIDOLPH electronically signed the Loan Authorization and Agreement

acknowledging the loan proceeds must be used solely as working capital for the

business.

12. The SBA approved the loan and on June 9, 2020 electronically

wired $59,900 ($60,000 less $100 fees and charges) into Mine LLC's bank account.

13. It was further part of the scheme JOHN RICHARD STIDOLPH

used the proceeds from the Mine LLC loan to make personal credit card payments

and fund trading activity within STIDOLPH'S TD Ameritrade account.
Case 4:21-cr-00136-RGE-SHL Document 2 Filed 10/13/21 Page 4 of 12

14. It was further part of the scheme that on March 30, 2020, JOHN

RICHARD STIDOLPH applied for a $150,000 EIDL from the SBA in the name of One

Nation LLC. On the application, he falsely reported One Nation LLC's gross revenue

as $49,778,000 and the cost of goods sold at $11,406,000 for the twelve-month period

ending January 31, 2020. JOHN RICHARD STIDOLPH electronically signed the

loan application and certified the information was true and correct, knowing the

information was not true and correct and that the gross revenue and cost of goods

sold information was false.

15. It was further part of the scheme to defraud that JOHN

RICHARD STIDOLPH electronically signed the Loan Authorization and Agreement

acknowledging the loan proceeds must be used solely as working capital for the

business.

16. The SBA approved the loan and on June 11, 2020 electronically

wired $149,900 ($150,000 less $100 fees and charges) into One Nation LLC's bank

account.

17. It was further part of the scheme JOHN RICHARD STIDOLPH

used the proceeds from the One Nation LLC loan to make personal credit card

payments and fund trading activity within STIDOLPH'S TD Ameritrade account.

18. It was part of the scheme that on March 30, 2020, LORA

STIDOLPH applied for a $150,000 EIDL from the SBA in the name of Addition

Doctors. She listed herself as a 51% owner and JOHN RICHARD STIDOLPH as a

49% owner of Addition Doctors. On the application, she falsely reported Addition
4
Case 4:21-cr-00136-RGE-SHL Document 2 Filed 10/13/21 Page 5 of 12

Doctors' gross revenue as $307,416,000 and the costs of goods sold at $96, 858, 000 for

the twelve-month period ending January 31, 2020. LORA LEE STIDOLPH

electronically sigl).ed the loan application and certified the information was true and

correct, knowing the information was not true and correct and that the gross revenue

and cost of goods sold information was false.

19. It was further part of the scheme to defraud that LORA LEE

STIDOLPH electronically signed the Loan Authorization and Agreement

acknowledging the loan proceeds must be used solely as working capital for the

business.

2 0. The SBA approved the loan and on July 31, 2020 electronically

wired $149,900 ($1 50,000 less $100 fees and charges) into Addition Doctors' bank

account.

21. It was further part of the scheme JOHN RICHARD STIDOLPH

used the proceeds from the Addition Doctors' loan to make personal credit card

payments and fund the STIDOLPH'S personal bank account and Mine LLC's bank

account

22. It was part of the scheme that on June 4, 2020, JOHN RICHARD

STIDOLPH applied for an EIDL from the SBA in the name of One Nation LLC. On

the application, he reported One Nation LLC's gross revenue as $47,4 50 and the cost

of goods sold at $6,740 for the twelve-month period ending January 31, 2020. JOHN

RICHARD STIDOLPH electronically signed the loan application and certified the

information was true and correct. The SBA denied the loan application.
Case 4:21-cr-00136-RGE-SHL Document 2 Filed 10/13/21 Page 6 of 12

23. It was part of the scheme that on June 4, 2020, JOHN RICHARD

STIDOLPH applied for an EIDL from the SBA in the name of Addition Doctors. He

listed himself as 100% owner of Addition Doctors. On the application, he reported

Addition Doctors' gross revenue as $361,877 and the costs of goods sold at $119,754

for the twelve-month period ending January 31, 2020. JOHN RICHARD STIDOLPH

electronically signed the loan application and certified the information was true and

correct. The SBA denied the loan application.

24. It was part of the scheme that on July 15, 2020, JOHN RICHARD

STIDOLPH applied for an EIDL from the SBA in the name of Addition Doctors. He

listed himself as 49% owner of Addition Doctors and LORA LEE STIDOLPH as 51%

owner. On the application, he reported Addition Doctors' gross revenue as $277, 1 66

and the costs of goods sold at $97,307 for the twelve-month period ending January

31, 2020. JOHN RICHARD STIDOLPH electronically signed the loan application

and certified the information was true and correct. The SBA denied the loan

application.

25. It was part of the scheme that on September 1 3, 2020, JOHN

RICHARD STIDOLPH applied for an EIDL from the SBA in the name of Mine LLC.

On the application, he reported Mine LLC's gross revenue as $39.884 and the costs

of goods sold at $16,241 for the twelve-month period ending January 31, 2020. JOHN

RICHARD STIDOLPH electronically signed the loan application and certified the

information was true and correct. The SBA denied the loan application.

26. It was part of the scheme that on March 10, 2021, JOHN
6
Case 4:21-cr-00136-RGE-SHL Document 2 Filed 10/13/21 Page 7 of 12

RICHARD STIDOLPH applied for an EIDL from the SBA in the name of Addition

Doctors. He listed himself as 100% owner of Addition Doctors. On the application, he

reported Addition Doctors' gross revenue as $30 7,900 and the costs of goods sold at

$120 ,870 for the twelve-month period ending January 31, 2020. JOHN RICHARD

STIDOLPH electronically signed the loan application and certified the information

was true and correct. The SBA denied the loan application.

27. It was part of the scheme that on March 20, 2021, JOHN

RICHARD STIDOLPH applied for an EIDL from the SBA in the name of Cabin LLC.

He listed himself as the 100% owner of Cabin LLC. On the application, he falsely

reported Cabin LLC's gross revenue as $680, 000 and the cost of goods sold as $21, 000

for the twelve-month period ending January 31, 2020. JOHN RICHARD STIDOLPH

electronically signed the loan application and certified the information was true and

correct, knowing the information was not true and correct and that Cabin LLC was

not a company and the gross revenue and cost of goods sold information was false.

28. It was part of the scheme that on March 25, 2021, JOHN

RICHARD STIDOLPH applied for an EIDL from the SBA in the name of Cabin LLC.

He listed himself as the 10 0% owner of Cabin LLC. On the application, he falsely

reported Cabin LLC's gross revenue as $680 , 000 and the cost of goods sold was

$21, 000 for the twelve-month period ending January 31, 2020. JOHN RICHARD

STIDOLPH electronically signed the loan application and certified the information

was true and correct, knowing the information was not true and correct and that

Cabin LLC was not a company and the gross revenue and cost of goods sold
Case 4:21-cr-00136-RGE-SHL Document 2 Filed 10/13/21 Page 8 of 12

information was false.

29. It was part of the scheme that on May 13, 2021, JOHN RICHARD

STIDOLPH applied for an EIDL from the SBA in the name of Addition Doctors. He

listed himself as 100% owner of Addition Doctors. On the application, he reported

Addition Doctors' gross revenue as $277,166 and the costs of goods sold at $97,307 for

the twelve-month period ending January 31, 2020. JOHN RICHARD STIDOLPH

electronically signed the loan application and certified the information was true and

correct. The SBA denied the loan application.

30. In furtherance of the scheme, and to continue to defraud the SBA,

JOHN RICHARD STIDOLPH and. LORA LEE STIDOLPH, through the use of

electronic mail, knowingly provided false information to the SBA to fraudulently

secure loan proceeds. JOHN RICHARD STIDOLPH and LORA LEE STIDOLPH also

caused the SBA to use interstate wires, in furtherance of his scheme to defraud,

through money wire transfers funding the fraudulently obtained EIDL loans.

Counts 1- 2
(Wire Fraud - JOHN RICHARD STIDOLPH)

31. Paragraphs 1 - 30 of the Indictment are re-alleged and incorporated

herein.

32. On or about each of the dates set forth below, in the Southern District

of Iowa and elsewhere, the defendant, JOHN RICHARD STIDOLPH, for the purpose

of executing and attempting to execute the scheme and artifice to defraud described

above, and to obtain money and property by means of false and fraudulent pretenses

8
Case 4:21-cr-00136-RGE-SHL Document 2 Filed 10/13/21 Page 9 of 12

and representations, did knowingly deliver and cause to be delivered by means of

wire in interstate commerce, monies dentified below:

Count Date Nature of Wired Item
SBA, by way of interstate wire, to Mine LLC's
1 6/9/2020 VisionBank account in the Southern District of
Iowa, wired $59,900.
SBA, by way of interstate wires, to One Nation
2 6/11/2020 LLC's VisionBank account in the Southern District
of Iowa, wired $149,900.

Each of the above counts is a violation of Title 18, United States Code, Section

1343.

THE GRAND JURY FURTHER CHARGES

Count 3
(Wire Fraud - LORA LEE STIDOLPH)

33. Paragraphs 1 - 30 of the Indictment are re-alleged and incorporated

herein.

34. On or about the date set forth below, in the Southern District of Iowa

and elsewhere, the defendant, LORA LEE STIDOLPH, for the purpose of executing

and attempting to execute the scheme and artifice to defraud described above, and to

obtain inoney and property by means of false and fraudulent pretenses and

representations, did knowingly deliver and cause to be delivered by means of wire in

interstate commerce, money identified below:

9
Case 4:21-cr-00136-RGE-SHL Document 2 Filed 10/13/21 Page 10 of 12

Count Date Nature of Wired Item
SBA, by way of interstate wire, to Addition Doctors'
3 7/31/2020 City State Bank account in the Southern District of
Iowa, wired $149,900.

This is a violation of Title 18, United States Code, Section 1343.

THE GRAND JURY FURTHER CHARGES

Counts 4 - 7
(False Statements - JOHN RICHARD STIDOLPH)

35. Paragraphs 1 - 30 of the Indictment are re-alleged and incorporated

herein.

36. On or about each of the dates set forth below, in the Southern District

of Iowa and elsewhere, the defendant, JOHN RICHARD STIDOLPH, did willfully

and knowingly make materially false, fictitious, and fraudulent statements and

representations on Economic Injury Disaster Loan applications, a matter within the

jurisdiction of the U.S. Small Business Association.

Count Date Nature of False Statement
JOHN RICHARD STIDOLPH applied for an EIDL
loan in the name of Mine LLC and stated Mine LLC
had gross revenue of $41,638,000 and cost of goods
4 3/30/2020 sold as $14,167,000. These material representations
were false as STIDOLPH knew Mine LLC did not
have gross revenue of $41,638,000 and cost of goods
sold of $14,167,000.

10
Case 4:21-cr-00136-RGE-SHL Document 2 Filed 10/13/21 Page 11 of 12

Count Date Nature of False Statement
JOHN RICHARD STIDOLPH applied for an EIDL
loan in the name of One Nation LLC and stated
One Nation LLC had gross revenue of $49,778,000
5 3/30/2020 and costs of goods sold as $11,406,000. These
material representations were false as STIDOLPH
knew One Nation LLC did not have gross revenue
of $41,638,000 and cost of goods sold of $14,167,000.
JOHN RICHARD STIDOLPH applied for an EIDL
loan in the name of Cabin LLC and stated Cabin
LLC had gross revenue of $680,000 and cost of
goods sold as $21,000. These material
6 3/20/2021
representations were false as STIDOLPH knew
Cabin LLC was not a company and knew Cabin
LLC did not have gross revenue of $680,000 and
cost of goods sold of $21,000.
JOHN RICHARD STIDOLPH applied for an EIDL
loan in the name of Cabin LLC and stated Cabin
LLC had gross revenue of $680,000 and cost of
goods sold as $21,000. These material
7 3/25/2021
representations were false as Cabin LLC was not a
company and Cabin LLC did not have gross
revenue of $680,000 and cost of goods sold of
$21,000.

Each of the above counts is a violation of Title 18, United States Code, Section

1001(a)(2).

THE GRAND JURY FURTHER CHARGES

Count 8
(False Statement- LORA LEE STIDOLPH)

37. Paragraphs 1 - 30 of the Indictment are re-alleged and incorporated

herein.

38. On or about the date set forth below, in the Southern District of Iowa
11
Case 4:21-cr-00136-RGE-SHL Document 2 Filed 10/13/21 Page 12 of 12

and elsewhere, the defendant, LORA LEE STIDOLPH, did willfully and knowingly

make materially false, fictitious, and fraudulent statements and representations on

an Economic Injury Disaster Loan application, a matter within the jurisdiction of the

U.S. Small Business Association.

Count Date Nature of False Statement
LORA LEE STIDOLPH applied for an EIDL loan in
the name of Addition Doctors and stated Addition
Doctors had gross revenue of $307,416,000 and
costs of goods sold as $96,858,000. These material
8 3/30/2020
representations were false as LORA LEE
STIDOLPH knew Addition Doctors did not have
gross revenue of $307,416,000 and cost of goods sold
of $96,858,000.

This is a violation of Title 18, United States Code, Section 1001(a)(2).

A TRUE BILL.

Richard D. Westphal
Acting United States Attorney

By:
Rachel J. Scherle
Assistant United States Attorney

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