HUNTSVILLE, Alabama – A federal judge has sentenced a Decatur woman to six months in prison for lying on an application for a Paycheck Protection Program loan, U.S. Attorney Phillip W. Williams Jr. announced.
U.S. District Judge Liles C. Burke sentenced 49-year-old Sylvia Lynn Pitts, also known as “Scylvia L. Pitts,” of Decatur in Morgan County. Pitts pleaded guilty to making false statements.
What the plea agreement says
According to the plea agreement, Pitts applied for the Small Business Administration-backed loan on July 10, 2020, through a bank in Decatur. On SBA Form 2483, she said she was a sole proprietor operating a business named “Sylvia L. Pitts” and that she would spend the money on payroll and utilities.
To support the application, Pitts submitted a 2019 Schedule C for a business called Pitts Cleaning Services. The form listed gross receipts of $112,100, expenses of $10,636 and a net profit of $101,464. Prosecutors said the information was fraudulent.
The loan money landed in Pitts’s checking account on July 22, 2020. She then pulled it out in three withdrawals: $8,800 on July 30, $6,000 on August 6 and $6,000 on August 13. Pitts spent the money on personal debt and personal expenses, according to the plea agreement.
Tax returns told a different story
Investigators reviewed Pitts’s tax filings and found she filed two Schedule Cs with her 2019 returns, one for a cleaning business and one for a lawn-care business. Neither matched the Schedule C she submitted with the PPP application.
Officials respond
“Stealing taxpayer dollars through fraudulent schemes will not be tolerated,” Williams said. “The Paycheck Protection Program was created to help struggling businesses, not line the pockets of those who choose to abuse the system. Combatting fraud is a top priority of the Department of Justice and my office. We will aggressively pursue those who commit fraud and work with our law enforcement partners to ensure they are held accountable.”
D. Eric Beals, assistant inspector general for investigations with the Tennessee Valley Authority’s Office of Inspector General, also commented. “The TVA OIG is committed to identifying and investigating fraud that negatively impacts the ratepayers of the Tennessee Valley, taxpayers, and United States Government,” Beals said. “This case presents another example of that commitment along with that of the United States Attorney’s Office and our other law enforcement partners.”
Patrick M. Palmer, acting assistant special agent in charge of the Atlanta Field Office for IRS Criminal Investigation, said the agency “remains committed to working with our law enforcement partners to safeguard public funds and preserve the integrity of programs intended to serve those who legitimately qualify for assistance.”
The TVA Office of Inspector General and IRS Criminal Investigation investigated the case. Assistant U.S. Attorney Davis A. Barlow prosecuted it.