CHARLESTON, W.Va. – Kanawha County resident Krista Marie Menchaca, 32, has been sentenced to three years of federal probation and ordered to pay $21,963.96 in restitution after being caught with her hands in the cookie jar of Paycheck Protection Program (PPP) fraud.
Menchaca, who hails from Cross Lanes, was hit with the charges after she received $19,395 in proceeds from a criminally derived PPP loan, a windfall guaranteed by the Small Business Administration (SBA) under the Coronavirus Aid, Relief, and Economic Security Act (CARES Act).
On May 12, 2021, Menchaca’s name was used to submit a fraudulent PPP loan application to a lender in Arizona. The application falsely portrayed her as a self-employed health practitioner who had earned $93,100 in gross income during 2000. According to court documents, the IRS Form 1040 filed with the application was a fake, crafted specifically to secure the fraudulent loan.
The lender fell for the ruse and deposited $19,395 into Menchaca’s personal bank account on July 2, 2021. However, it seems Menchaca wasn’t content to let the money sit; she allegedly spent more than $5,000 of the PPP loan proceeds on her own expenses while in West Virginia.
The CARES Act, designed to help sole proprietors, independent contractors, and self-employed individuals affected by the COVID-19 pandemic, allowed for forgivable PPP loans to replace lost income. Applicants were required to affirm their operation status as of February 15, 2020, along with documentation of prior gross income.
Acting United States Attorney Lisa G. Johnston led the charge against Menchaca and praised the investigative efforts of the West Virginia State Police – Bureau of Criminal Investigation (BCI). Senior United States District Judge David A. Faber handed down the sentence, while Assistant United States Attorney Jonathan T. Storage prosecuted the case.
For those with information about COVID-19 fraud allegations, the Department of Justice encourages reporting via the National Center for Disaster Fraud Hotline at 866-720-5721 or through the NCDF Web Complaint Form at this link. A copy of this press release can be found on the U.S. Attorney’s Office website for the Southern District of West Virginia, and related court documents are accessible via PACER by searching Case No. 2:25-cr-68.
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Key Facts
- State: West Virginia
- Agency: DOJ USAO
- Category: Fraud & Financial Crimes
- Source: Official Source ↗
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