Information — United States v. Farren G. Ricketts, Western District of Virginia (Document 1)
Summary
A criminal information in United States of America v. Farren G. Ricketts, filed June 15, 2021 as Document 1 in No. 2:21-cr-00011-JPJ-PMS in the U.S. District Court for the Western District of Virginia, Big Stone Gap. It charges conspiracy under 18 U.S.C. § 371, conspiracy to commit mail fraud under 18 U.S.C. § 1349 / § 1341, and aggravated identity theft under 18 U.S.C. § 1028A. The information alleges that Ricketts, through Ricketts Advisory, LLC, filed more than 100 fraudulent claims for pandemic unemployment benefits with the Virginia Employment Commission between May 2020 and February 2021, including claims in the names of prison inmates. It alleges fees of $1,000.00 to $3,000.00 per client and later 32% of weekly benefits, and an aggregate actual loss of not less than $669,124.00. The signature block names Acting United States Attorney Daniel P. Bubar.
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“Information — United States v. Farren G. Ricketts, Western District of Virginia (Document 1).”
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Case 2:21-cr-00011-JPJ-PMS Document 1 Filed 06/15/21 Page 1 of 13 Pageid#: 1
UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF VIRGINIA
BIG STONE GAP
UNITED STATES OF AMERICA )
) Case No.
v. )
) Violations:
FARREN G. RICKETTS )
) 18 U.S.C. § 371
) 18 U.S.C. § 1349 / § 1341
) 18 U.S.C. § 1028A
INFORMATION
INTRODUCTION
The United States Attorney Charges that:
CARES Act and Pandemic Unemployment Benefits
1. Unemployment Insurance (UI) is a state-federal program that provides
monetary benefits to eligible lawful workers. Although state workforce agencies
(SWAs) administer their respective UI programs, they must do so in accordance
with federal laws and regulations. UI payments (benefits) are intended to provide
temporary financial assistance to lawful workers who are unemployed through no
fault of their own. Each state sets its own additional requirements for eligibility,
benefit amounts, and length of time benefits can be paid. Generally, UI weekly
benefit amounts are based on a percentage of earnings over a base period. In
the Commonwealth of Virginia, the Virginia Employment Commission (VEC)
administers the UI program.
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2. On March 13, 2020, the President of the United States declared the
ongoing Coronavirus Disease (COVID-19) pandemic to be an emergency under
§501(b) of the Robert T. Stafford Disaster Relief and Emergency Assistance Act
(42 U.S.C §§ 5121-5207).
3. On March 18, 2020, the President signed the Families First Coronavirus
Response Act (“FFCRA”) into law. The FFCRA provided additional flexibility for
state UI agencies and additional administrative funding to respond to the COVID-
19 pandemic. The Coronavirus Aid, Relief, and Economic Security (“CARES”)
Act was signed into law on March 27, 2020. The CARES Act expanded states’
ability to provide UI for many workers impacted by COVID-19, including for
workers who were not ordinarily eligible for UI benefits. The CARES Act provided
for three new UI programs: Pandemic Unemployment Assistance (“PUA”);
Federal Pandemic Unemployment Compensation (“FPUC”); and Pandemic
Emergency Unemployment Compensation (“PEUC”).
4. The first program, PUA, provided for up to 39 weeks of benefits to
individuals who are self-employed, seeking part-time employment, or otherwise
did not qualify for regular UI or extended benefits under state or federal law or
PEUC (detailed further below). Coverage included individuals who had
exhausted all rights to regular UI benefits or extended benefits under state or
federal law or PEUC. Under the PUA provisions of the CARES Act, a person
who is a business owner, self-employed worker, independent contractor, or gig
worker can qualify for pandemic unemployment benefits administered by the
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VEC if he/she previously performed such work in Virginia and is unemployed,
partially unemployed, unable to work, or unavailable to work due to a COVID-19
related reason. The eligible timeframe to receive PUA included weeks of
unemployment beginning on or after January 27, 2020 through December 31,
2020.
5. The second program, PEUC, is a state-federal program that provided
for up to 13 weeks of benefits to individuals who had exhausted regular UI under
state or federal law, had no rights to regular UI under any other state or federal
law, were not receiving UI under the UI laws of Canada, and were otherwise able
to work, available for work, and actively seeking work. Under this program,
states must offer flexibility in meeting the “actively seeking work” requirement if
individuals are unable to search for work because of COVID-19, including
because of illness, quarantine, or movement restriction. The eligible timeframe
to receive PEUC included weeks of unemployment beginning after the respective
state established an agreement with the federal government through December
31, 2020. The earliest being April 5, 2020.
6. The third program, FPUC, provided individuals who were collecting
regular UI, PEUC, PUA, and several other forms of benefits with an additional
$600 per week. The eligible timeframe to receive FPUC was from weeks of
unemployment beginning after the respective state had an established
agreement with the federal government through July 31, 2020. The earliest
being April 5, 2020.
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7. On August 8, 2020, after FPUC expired, the President signed a
Presidential Memorandum authorizing FEMA to use disaster relief funds
pursuant to Section 408 of the Stafford Act to provide supplemental payments for
lost wages to help ease the financial burden on individuals who were
unemployed as a result of COVID-19. The “Lost Wages Assistance Program”
(“LWAP”) served as a temporary measure to provide an additional $300 per
week via a total of $44 billion in FEMA funds. The period of assistance for LWAP
was August 1, 2020 to December 27, 2020.
8. In total, more than $300 billion in additional federal funds for UI were
appropriated in 2020.
9. The PUA, FPUC, and LWAP programs (collectively, “pandemic
unemployment benefits”) are administered by the various states, including the
Commonwealth of Virginia, but their benefits are funded by the federal
government. In order to receive pandemic benefits, an applicant must access a
website maintained and administered by the VEC and file a claim. Separate
claims are not filed for PUA, FPUC, and LWAP. Rather, a single claim for PUA,
if approved, resulted in an approved claim for the additional FPUC and LWAP
benefits as well.
10. Individuals are only eligible for pandemic unemployment benefits if
they are unemployed for reasons related to the COVID-19 pandemic and are
otherwise available to work and are seeking employment.
11. Once an applicant is at the website, the applicant is required to enter
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personally identifiable information (PII) including name, date of birth, Social
Security Number, email address, phone number, and physical address. An
applicant is then required to answer a series of questions to determine eligibility
and payment amount. An applicant must then attest, under penalty of perjury,
that the information provided in the claim application is true and accurate.
12. Upon completion, the application is submitted to the VEC. If
approved, the applicant can choose whether to have the pandemic
unemployment benefits deposited directly into a bank account of their choosing,
or the funds can be loaded on a pre-paid debit card which is then shipped to the
applicant via United States Postal Service to the address listed on their
application.
13. The recipient of pandemic unemployment benefits receives a unique
Personal Identification Number (“PIN”) to access the VEC each week to re-certify
their unemployment status. Payments for pandemic unemployment benefits are
based on a seven-day period, from Sunday through Saturday. Thus, the benefits
recipient must certify every seven days that he or she: was ready, willing and
able to work each day; was seeking full time employment; did not refuse any job
offers or referrals; and had reported any employment during the week and the
gross pay or other payments received.
The Conspiracy
14. In April 2020, FARREN G. RICKETTS (RICKETTS) and her husband
developed a scheme and artifice to file fraudulent claims for pandemic
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unemployment benefits via the VEC website. The scheme and artifice was to
submit claims for various individuals, including RICKETTS, her husband, and
others who were then known to be ineligible to receive pandemic unemployment
benefits by making materially false representations including, but not limited to:
that the applicant was unemployed as a result of COVID-19; using a fictitious
employer as the name of the last employer when the applicant became
unemployed due to COVID-19; that the applicant was ready, willing, and able to
work each day; and that the applicant was actively seeking full-time employment.
15. Because pandemic unemployment benefits were paid on a weekly
basis, the scheme was a continuing scheme whereby RICKETTS and her co-
conspirators agreed and conspired to file weekly re-certifications for the claims
they submitted. In so doing, RICKETTS re-verified and re-certified the same
materially false representations and pretenses as stated herein for each claim
submitted, on numerous occasions as further detailed below.
16. To effect the object of the conspiracy, RICKETTS and her husband
developed a business entity called “Ricketts Advisory, LLC” and advertised
services including assistance in filing pandemic unemployment claims.
RICKETTS applied for and received a Tax Preparer’s Identification Number from
the Internal Revenue Service and also registered her business as a limited
liability company (LLC) with the Virginia State Corporation Commission.
RICKETTS registered her business as an “economic consulting” entity, listing
herself as a 51% Chief Executive Member, and her husband as a 49% member.
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17. RICKETTS registered her business as operating out of her home in
Jonesville, Virginia, which is in the Western District of Virginia. At all relevant
times during this conspiracy, RICKETTS resided in Jonesville, Virginia and filed
all fraudulent claims from her home in Jonesville, Virginia.
Manner and Means of the Conspiracy
18. In order to effect the object of the conspiracy, RICKETTS and her co-
conspirators undertook the following overt acts, as well as others not detailed
herein:
a. RICKETTS first filed a fraudulent claim for pandemic
unemployment benefits on behalf of her husband on or about April 2, 2020. On
or about April 9, 2020, RICKETTS filed a fraudulent claim for pandemic
unemployment benefits on her own behalf. The filing of this fraudulent claim
resulted in at least $18,162.00 being paid to RICKETTS including PUA and
LWAP payments. At the time of the filings, neither RICKETTS nor her husband
was unemployed because of COVID-19; neither was eligible to receive pandemic
unemployment benefits.
b. Shortly after filing each claim, RICKETTS received from the
VEC via United States Post a monetary determination letter, PIN code, and
Mastercard debit card in each co-conspirator’s name shipped to a P.O. box in
Jonesville, Virginia. The P.O. box was the postal address used by RICKETTS on
the fraudulent applications. In order to continue to receive weekly pandemic
unemployment benefit deposits, RICKETTS made subsequent weekly re-
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certifications for all fraudulent claims through the VEC website.
c. After RICKETTS and her husband began receiving pandemic
unemployment benefits, RICKETTS’ husband started bringing friends and
acquaintances to RICKETTS so that she could submit fraudulent claims for
pandemic unemployment benefits on their behalf.
d. RICKETTS’ husband encouraged RICKETTS to begin
charging a fee for the service of assisting others in filing fraudulent claims.
RICKETTS initially charged a one-time flat fee of $1,000.00 to clients seeking her
assistance with filing fraudulent claims. This fee increased to $2,000.00 per
client before eventually increasing to $3,000.00 per client. RICKETTS eventually
changed her business model to take 32% of the weekly benefits paid for every
client she assisted.
e. Between May 2020 and February 2021, RICKETTS filed more
than 100 fraudulent claims for pandemic unemployment benefits. For many of
these claims, RICKETTS created fraudulent documents to support the claims she
was filing, including fraudulent IRS Forms (1099-MISC) purporting to document
pre-COVID-19 employment income in the names of the respective applicants.
RICKETTS filed numerous other fraudulent claims in the names of prison
inmates who were unaware that she was using their personally identifiable
information.
f. In or about May 2020, a co-conspirator provided RICKETTS
several pages of names and personally identifiable information pertaining to state
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inmates in various jail facilities in southwest Virginia and eastern Tennessee.
The co-conspirator represented to RICKETTS that the inmates were all
sentenced to long jail terms and would not know if she were to file fraudulent
claims in their names. RICKETTS then filed numerous fraudulent claims for
pandemic unemployment benefits in these individuals’ names, including a claim
for an individual identified as L.H.
g. Because each claim required weekly re-certifications to
continue receiving benefits, the conspiracy quickly became more than
RICKETTS could handle by herself. By August 2020, RICKETTS began hiring
employees for the purpose of managing and filing weekly certifications for the
fraudulent claims that were filed. In total, RICKETTS hired at least six
employees, requiring each to sign nondisclosure and confidentiality agreements.
Employees were paid for their services by cash and by access to pre-paid debit
cards that were issued by the VEC in the names of various claimants.
CONCLUSION
19. The aggregate actual loss for all fraudulent claims filed as part of
this conspiracy is not less than $669,124.00.
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COUNT ONE
18 U.S.C. § 371
(Conspiracy to Commit an Offense / Defraud the United States)
The United States Attorney charges that:
1. The Introduction is realleged and incorporated by reference.
2. Between on or about April 1, 2020, and on or about February 28, 2021
in the Western District of Virginia and elsewhere, FARREN G. RICKETTS and
others knowingly and willfully conspired and agreed with each other to (1)
defraud the United States and (2) commit an offense against the United States,
to wit: file fraudulent claims for pandemic unemployment benefits as authorized
by, and administered through, federal law in violation of Title 18, United States
Code, §1040(a), such benefits being authorized, paid, and disbursed in
connection with the Coronavirus Disease (COVID-19) pandemic, an emergency
declaration under §501 of the Robert T. Stafford Disaster Relief and Emergency
Assistance Act.
3. It was a part of the conspiracy that FARREN G. RICKETTS and her co-
conspirators submitted fraudulent claims for pandemic unemployment benefits in
order to receive funds to which they were not entitled.
4. To effect the object of the conspiracy, FARREN G. RICKETTS and her
co-conspirators committed several acts, including but not limited to those acts
described in the Introduction to this Information.
5. All in violation of Title 18, United States Code, § 371.
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COUNT TWO
18 U.S.C. § 1349/1341
(Conspiracy to Commit Mail Fraud)
The United States Attorney charges that:
1. The Introduction is realleged and incorporated by reference.
2. Between on or about April 1, 2020, and on or about February 28, 2021
in the Western District of Virginia and elsewhere, FARREN G. RICKETTS and
others knowingly conspired with each other to commit mail fraud of benefits
authorized by, disbursed, and paid in connection with a presidentially declared
major disaster or emergency as defined by section 102 of the Robert T. Stafford
Disaster Relief and Emergency Assistance Act (42. U.S.C. § 5122 et. seq.), in
violation of Title 18, United States Code, §1341, that is, having devised and
intending to devise a scheme and artifice to defraud and to obtain money and
property by means of materially false and fraudulent pretenses and
representations, and for the purpose of attempting to execute, and executing
such scheme and artifice, received a matter or thing, to wit: government debit
cards and monetary determination letters, that were sent and delivered by the
United States Postal Service.
3. To effect the object of the conspiracy, FARREN G. RICKETTS and her
co-conspirators committed several acts, including but not limited to, the acts
described in the Introduction to this Information.
4. All in violation of Title 18, United States Code, § 1349 and § 1341.
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COUNT THREE
18 U.S.C § 1028A
(Aggravated Identity Theft)
1. The Introduction is realleged and incorporated by reference.
2. On or about August 27, 2020, in the Western District of Virginia,
FARREN G. RICKETTS and others knowingly used, without lawful authority, a
means of identification of another person during and in relation to a felony
violation enumerated in 18 U.S.C. § 1028A(c), to wit: 18 U.S.C. § 1040 and 18
U.S.C. § 1341, knowing that the means of identification belonged to another
actual person, to wit: L.H.
3. All in violation of 18 U.S.C. § 1028A(a)(1).
NOTICE OF FORFEITURE
1. Upon conviction of one or more of the felony offenses alleged in this
Indictment, defendant shall forfeit to the United States:
a. any property, real or personal, which constitutes or is derived
from proceeds traceable to said offenses, pursuant to 18
U.S.C. § 981(a)(1)(C) and 28 U.S.C. § 2461.
b. Edit and/or add forfeiture provisions based on SUA to be
obtained from draft indictment.
2. If any of the above-described forfeitable property, as a result of any
act or omission of the defendant:
a. cannot be located upon the exercise of due diligence;
b. has been transferred or sold to, or deposited with a third
person;
c. has been placed beyond the jurisdiction of the Court;
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d. has been substantially diminished in value; or
e. has been commingled with other property which cannot be
subdivided without difficulty;
it is the intent of the United States to seek forfeiture of any other property of the
defendant up to the value of the above-described forfeitable property, pursuant to
21 U.S.C. § 853(p).
DATE: 6/14/2021
FOR_________________________
DANIEL P. BUBAR
Acting United States Attorney
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