Westerville, Ohio – A 63-year-old Westerville resident has been sentenced to nearly six years in federal prison for orchestrating a massive COVID-19 relief fraud scheme that involved fake business claims and the misuse of public funds. Lorie A. Schaefer was handed a 70-month sentence in U.S. District Court after pleading guilty to her role in a scam that cost the government approximately $2.8 million.
False Business Ties and Fabricated Documents
According to court records, Schaefer falsely claimed to be affiliated with the Flying Pizza restaurants located in Dayton, Centerville, and Fairborn in order to secure a $1.9 million Paycheck Protection Program (PPP) loan. The family-owned restaurant chain had no connection to her and, when contacted, said they could not support such a large loan request.
Schaefer set up new bank accounts in December 2020 and later registered a fictitious business under the Flying Pizza name with the State of Ohio in March 2021. In her application, she falsely claimed to have 98 employees and provided fraudulent bank statements, tax records, and a letter supposedly from the IRS. She also lied about her legal status, denying that she had pending theft charges in Meigs County.
Schaefer’s fraudulent application and supporting documents were part of an elaborate scheme to siphon pandemic relief funds. In addition to the false loan she secured for herself, she assisted a co-defendant in obtaining over $980,000 in PPP loans in exchange for payment, bringing the total fraud amount to $2.8 million.
Lavish Personal Spending and Violations of Release
Instead of using the relief funds for legitimate business purposes, Schaefer spent extravagantly on herself. Investigators found that she spent nearly $26,000 on liposuction and gifted $10,000 for a “newborn baby gift.” She also spent over $900,000 on the purchase and renovation of a home in Westerville and made various purchases from stores and restaurants including Wayfair, Lamps Plus, Kroger, KFC, Burger King, Arby’s, McDonald’s, and Olive Garden.
Evidence also showed that Schaefer used some of the ill-gotten money to buy vehicles in Ohio and even acquired property in Australia.
Following her initial indictment, Schaefer committed new crimes and violated her pre-trial release on multiple occasions. These violations ultimately led to the revocation of her bond. Though she pleaded guilty in July 2024, she made two unsuccessful attempts to withdraw her plea.
Schaefer’s sentencing marks the end of a complex and costly fraud that exploited emergency financial relief programs meant to assist struggling businesses during the COVID-19 pandemic.
