Tennessee Woman Pleads Guilty to COVID-19 Employment Tax Credit Scheme

A Tennessee woman pleaded guilty today to conspiring to commit wire and mail fraud by her role in making claims for refunds of false COVID-19 employment tax credits.

According to court documents and statements made in court, Aylissa Glidewell, of Kingsport, conspired with others to file false tax returns seeking fraudulent refunds based on the employee retention credit (ERC) and paid sick and family leave credit, both of which were created by Congress to aid struggling businesses during the COVID-19 global pandemic. Glidewell and co-conspirators created phony businesses, which lacked any employees or operations, for the sole purpose of claiming the bogus credits. Glidewell filed numerous false tax returns for those phony businesses and directed the tax refunds to be mailed to addresses she and co-conspirators controlled.

In total, the refunds claimed were over $3.4 million, of which the IRS paid approximately $1.8 million.

Glidewell is set to be sentenced on July 9. She faces a maximum penalty of 20 years in prison for conspiring to commit mail and wire fraud. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Acting Deputy Assistant Attorney General Karen E. Kelly of the Justice Department’s Tax Division and U.S. Attorney Francis M. Hamilton III for the Eastern District of Tennessee made the announcement.

IRS Criminal Investigation and the U.S. Secret Service investigated the case.

Trial Attorney Zachary A. Cobb of the Tax Division and Assistant U.S. Attorney Mac Heavener for the Eastern District of Tennessee are prosecuting the case.