A former Phoenix Police Department officer has been arrested by the FBI and faces federal fraud charges after allegedly fraudulently obtaining over $1 million in Paycheck Protection Program (PPP) loan money.
According to court documents, Toni Richardson and Willie Mitchell submitted a false PPP loan application to obtain money for their business, named “The Lotto Club.”
Richardson and Mitchell obtained in total $1,276,500 in PPP money for their business, but allegedly used the money for personal expenses and transferred the money to various bank accounts, including their personal banking accounts.
According to court documents, Richardson was 100% owner of the business and did not have any employees or payroll. The indictment alleges that Richardson knowingly submitted false reports, claiming the business had employees and a payroll. She declared 85 employees and an average monthly payroll ledger totaling more than $500,000 on the PPP application in February 2021.
The business was described as a nonprofit for veterans. According to online Arizona Corporation Commission records, the Lotto Club was incorporated on May 5, 2015, in Glendale.
Richardson, who worked as an officer for the Phoenix Police Department, is no longer on the police force. Officials in the department were in the process of terminating Richardson’s employment due to the circumstances surrounding the arrest. Toni Richardson submitted her letter of resignation before she was formally terminated.
Richardson faces multiple federal charges, ranging from conspiracy, bank fraud, transactional money laundering, to forfeiture allegation.
The Phoenix Police Department released a statement regarding the situation:
“Former Phoenix Police officer, Toni Richardson, faces federal fraud charges after being arrested by FBI.
The department was notified of the circumstances surrounding the arrest and immediately began the process to terminate employment. The employee submitted a letter of resignation prior to formal termination.
The city of Phoenix takes allegations of criminal conduct by our employees very seriously. The alleged actions of this employee go against the core values of the city and everything we stand for as public servants.”
No additional information was immediately available.