A Tennessee tax business owner admitted in federal court Tuesday to masterminding a sprawling fraud ring that siphoned roughly $80 million in COVID-11 relief funds meant for struggling small businesses. Renata Walton, 45, who ran a tax preparation firm in Moscow, Tennessee, pleaded guilty to charges involving the systemic theft of pandemic-era credits and loans.
Between March 2022 and August 2023, Walton and an employee, Nicole Jones, filed a wave of fraudulent tax returns. The duo targeted the Employee Retention Credit (ERC) and pandemic-related sick and family leave credits—programs established by Congress to keep businesses afloat during the global health crisis.
According to court records, the pair fabricated wage amounts for their clients, claiming massive payouts for employees that simply did not exist or weren’t paid those amounts.
The scheme extended to the Small Business Administration (SBA), where Walton submitted false applications for Paycheck Protection Program (PPP) and Economic Injury Disaster Loans (EIDL). These filings were backed by forged tax documents intended to trick the government into releasing emergency funds.
Once the IRS caught wind of the discrepancies and began contacting clients to claw back the money, Walton attempted to cover her tracks. She provided her clients with scripted letters to give to investigators, falsely claiming the fictitious wages were legitimate.
Neither Walton nor Jones filed their own tax returns for 2022, effectively hiding the millions in fees they collected from the scam. Typically, the pair charged clients a $15,000 “service fee” for every fraudulent return that landed a refund over $100,000.
The Department of Justice confirmed that Walton’s filings claimed nearly $80 million in total, resulting in an actual loss of more than $52 million to the U.S. government.
“The owner of a tax preparation business in Tennessee pleaded guilty today to orchestrating a massive fraud scheme,” officials stated during the announcement made by Assistant Attorney General A. Tysen Duva and U.S. Attorney D. Michael Dunavant.
Walton now faces a staggering legal reckoning, including a maximum of 20 years in prison for conspiracy to commit wire fraud and another 20 years for obstruction of justice.
She also faces additional years for money laundering and tax violations. Her accomplice, Jones, previously pleaded guilty in August 2025. Walton is scheduled for sentencing on June 18, while Jones will learn her fate on June 9. The case remains under investigation by IRS Criminal Investigation.
READ: Fugitive CEO’s 11-Year Run Ends In Guilty Plea For $6M Global Fraud
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