PHOENIX — A former Phoenix police officer is accused of taking out a false loan during the COVID-19 pandemic and receiving $1,276,500 in government loans for a business that had no employees or a payroll, federal prosecutors said.
According to a federal indictment, former officer Toni Richardson and Willie Mitchell submitted a false application for the Paycheck Protection Program and used the money for personal expenses, The Arizona Republic reported.
They face federal charges of conspiracy, bank fraud and transactional money laundering, according to KPHO-TV.
The business was called “The Lotto Club,” and was described as a nonprofit for veterans, according to KSAZ. Prosecutors allege that in addition to using the money for personal use, Richardson and Mitchell transferred the money to personal accounts, KNXV reported.
Former Phoenix Police officer Toni Richardson has been arrested for allegedly defrauding the COVID-19 relief fund for businesses, claiming she needed money for a nonprofit benefiting veterans. https://t.co/IQ25fu6RBu
— FOX 10 Phoenix (@FOX10Phoenix) December 9, 2021
According to online Arizona Corporation Commission records, the Lotto Club was incorporated on May 5, 2015, in Glendale. Richardson was listed as 100% owner of the business, online records show.
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Although the club had no employees or payroll, the indictment alleges that Richardson knowingly submitted false reports, declaring 85 employees and an average monthly payroll ledger totaling more than $500,000 on the PPP application in February 2021, the Republic reported.
Between March and June 2021, Richardson and Mitchell withdrew more than $15,000 on several occasions from the loan account, according to KPHO.
Richardson was arrested by the FBI on Dec. 1, according to the Republic.
Officials with the Phoenix Police Department said Richardson resigned after her arrest, KSAZ reported.
“The department was notified of the circumstances surrounding the arrest and immediately began the process to terminate employment,” Sgt. Andy Williams, a spokesperson for the Phoenix Police Department, said in a statement. “The employee submitted a letter of resignation prior to formal termination. The city of Phoenix takes allegations of criminal conduct by our employees very seriously. The alleged actions of this employee go against the core values of the city and everything we stand for as public servants.”
Richardson pleaded not guilty on all counts, and a court date has been set for 9 a.m. on Feb. 1, 2022, the Republic reported. Richardson was released on her own recognizance.
An attorney for Richardson has not responded to a request for comment, KNXV reported.
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