YAKIMA, WA – Karla Padilla, 48, of Yakima, Washington, is facing seven federal counts of fraud after allegedly swindling over $59,000 from COVID-19 relief programs. The indictment, handed down this week, is the latest development from the U.S. Attorney’s COVID-19 Relief Fraud Strike Force, a multi-agency task force formed to claw back stolen funds.
The scheme centers around the Coronavirus Aid, Relief, and Economic Security (CARES) Act, passed in March 2020. Billions were funneled to struggling small businesses through programs like the Paycheck Protection Program (PPP) and the Economic Injury Disaster Loan (EIDL) program. While intended to be a lifeline, the sheer volume of applications created an opening for fraudsters like Padilla, who allegedly exploited the system while legitimate businesses were left scrambling.
According to the indictment, Padilla claimed the funds on behalf of “Queen B Collectibles,” a supposed business specializing in collectible cars. Federal investigators allege this was a complete fabrication – a phantom business with no employees, no receipts, and no actual operations. Padilla allegedly submitted false information to secure one EIDL loan and two PPP loans, pocketing over $59,000 in government funds that she wasn’t entitled to.
U.S. Attorney Vanessa R. Waldref, for the Eastern District of Washington, framed the case as a direct attack on the community. “COVID-19 relief programs were designed to lift up our community during crisis,” Waldref stated. “We created the COVID-19 Fraud Strike Force because combating pandemic-related fraud… is critical to the strength and safety of our community.” The Strike Force, a coalition of federal agencies including the Secret Service, FBI, and Small Business Administration’s Office of Inspector General, has been aggressively pursuing these cases.
The investigation revealed Padilla also attempted, unsuccessfully, to obtain additional fraudulent loans. This wasn’t a one-time mistake; it was a deliberate and calculated effort to exploit a crisis for personal gain. The Strike Force is sending a message: those who preyed on the pandemic will be held accountable, even if it means sifting through mountains of paperwork and tracing fraudulent applications.
Padilla is now facing the consequences. While details of a potential trial date haven’t been released, a conviction on all seven counts of fraud could carry significant prison time and financial penalties. This case serves as a stark reminder that while the CARES Act provided vital support to many, it also attracted a swarm of predators willing to exploit the system for their own benefit. The U.S. Attorney’s Office promises more indictments are on the way as the Strike Force continues its work.
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Key Facts
- Agency: U.S. Secret Service
- Category: Fraud & Financial Crimes
- Source: Official Press Release
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