Kansas City, MO – A Kansas City, Mo., day care owner has pleaded guilty in federal court to 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.
Patricia L. Johnson-Rushing, 55, pleaded guilty before U.S. District Judge Greg Kays on Thursday, Sept. 7, 2023, 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.
The total fraud to which Johnson-Rushing pleaded guilty is $772,861.
The theft of public money charge stemmed from Johnson-Rushing submitting false claims to the Missouri Department of Social Services from Jan. 1, 2016, to Nov. 28, 2019, in order to receive payments from the federal Child Care and Development Block Grant Program.
Johnson-Rushing admitted that she submitted false documentation to misrepresent her ownership of the center and to falsely claim employment elsewhere in order to qualify for the childcare subsidy.
Johnson-Rushing also admitted to signing food stamp applications to receive subsidy money from the state of Missouri from 2016 to 2019, 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.
Johnson-Rushing unlawfully acquired $12,310 in food stamps based on the fraudulent statements and representations in her application.
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.
Johnson-Rushing is subject to a sentence of up to 35 years in federal prison without parole, under federal statutes, for the total tax loss in relevant conduct (which includes Johnson-Rushing’s portion of federal and state payroll taxes as the employer) of $499,142, combined with $154,186 in total tax loss for failure to pay over employee taxes yielding a total tax loss of $653,329.
The case was investigated by the U.S. Department of the Treasury’s Office of Inspector General and the Social Security Administration, Office of the Inspector General with the assistance of the Missouri Department of Social Services.
The defendant, Patricia L. Johnson-Rushing, 55, is scheduled to be sentenced on a later date.
In order to qualify for the childcare subsidy, Johnson-Rushing submitted false documentation to misrepresent her ownership of the center and to falsely claim employment elsewhere.
Personal expenses were also paid in her name from the Granny’s Pray & Play bank account, including $15,000 towards the purchase of a Cadillac Escalade in October 2016.
The defendant, Patricia L. Johnson-Rushing, is scheduled to be sentenced on a later date.
Key Facts
- State: Missouri
- Category: White Collar Crime
- Source: DOJ Press Release â†â€â€
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