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KC Daycare Owner Sentenced for $772,000 Fraud Scheme
KANSAS CITY, Mo. – Patricia L. Johnson-Rushing, 55, a Kansas City, Mo., day care owner, was sentenced in federal court today for her role in a conspiracy that resulted in a $653,329 tax loss to the federal government, as well as fraudulently collecting almost $120,000 in government benefits she was not entitled to receive.
Johnson-Rushing was sentenced by U.S. District Judge Greg Kays to two years and three months in federal prison without parole. The court also ordered Johnson-Rushing to pay $772,861 in restitution and to forfeit to the government $95,704.
On Sept. 7, 2023, Johnson-Rushing pleaded guilty to one count of theft of public money, one count of benefits fraud, and one count of conspiracy to defraud the United States. Johnson-Rushing admitted that she fraudulently received $83,394 in public funding for her childcare center, Granny’s Pray & Play, located at 3714 E. 27th Street in Kansas City, Mo., and that she unlawfully received food stamps.
Granny’s Pray & Play had about 15 employees and withheld funds in federal income tax and FICA contributions from their paychecks. Johnson-Rushing failed to pay over those trust fund taxes from her employees to the Internal Revenue Service in the amount of $154,186.58 from first quarter 2015 through fourth quarter 2018.
The total tax loss in relevant conduct is $499,142, which combined with $154,186 in total tax loss for failure to pay over employee taxes yields a total tax loss to the government of $653,329.
Johnson-Rushing admitted that she submitted false claims to the Missouri Department of Social Services that intentionally reported false information for children attending Granny’s Pray & Play from Jan. 1, 2016, to Nov. 28, 2019. The purpose of the scheme was to receive payments from the federal Child Care and Development Block Grant Program.
According to the plea agreement, the total funds fraudulently paid to Granny’s Pray & Play is $83,394. Johnson-Rushing also admitted that she participated in a conspiracy to obstruct the collection of federal employment taxes by failing to pay over to the government $154,186 in federal income tax and FICA contributions collected from the paychecks of Granny’s Pray & Play employees.
Johnson-Rushing unlawfully acquired $12,310 in food stamps from 2016 to 2019, after signing false applications claiming to have no job or bank account. In reality, she frequently withdrew funds from the Granny’s Pray & Play bank account to purchase cashier’s checks for herself.
The total fraud to which Johnson-Rushing pleaded guilty is a staggering $772,861, a clear example of the destruction caused by white-collar crimes in our community.
RELATED: KC Daycare Owner Sentenced for $772,000 Fraud Scheme
Key Facts
- State: Missouri
- Agency: DOJ USAO
- Category: White Collar Crime
- Source: Official Source ↗
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