FORT BEND COUNTY (Covering Katy News) — A Fort Bend County business owner has admitted to participating in a conspiracy to defraud federal pandemic relief programs, U.S. Attorney Alamdar S. Hamdani announced on Thursday.
Kristen Fenrick, 52, pleaded guilty to conspiracy to commit wire fraud in connection with submitting false applications for the Paycheck Protection Program and Economic Injury Disaster Loan programs under the Coronavirus Aid, Relief, and Economic Security (CARES) Act.
Between March 2020 and February 2022, Fenrick conspired to defraud the Small Business Administration by filing fraudulent applications through the PPP and EIDL programs, both intended to support businesses impacted by the COVID-19 pandemic.
As the owner of Klearly Kristen Inc., a Stafford jewelry and accessories business, Fenrick admitted to inflating her company's employee numbers and average payroll expenses in a PPP loan application.
To support the false application, Fenrick and a co-conspirator submitted fraudulent IRS documents to a third-party lender authorized by the SBA. As a result, the lender disbursed $405,340 in PPP funds to Klearly Kristen in June 2020.
Fenrick admitted to misusing some of the funds for personal expenses, including leasing a luxury vehicle, contrary to the terms of the loan. The PPP loan was later forgiven based on continued false representations about the business’s payroll and employee numbers.
Additionally, Fenrick confessed to submitting several fraudulent EIDL applications for Klearly Kristen and other businesses she claimed to own. Although most of these applications were unsuccessful, Fenrick secured a $10,000 advance for Klearly Kristen.
The fraudulent scheme resulted in a total loss of $415,340 to the PPP and EIDL programs.
U.S. District Judge Alfred H. Bennett has scheduled Fenrick’s sentencing for Jan. 30, 2025. She faces up to five years in federal prison and a maximum fine of $250,000. Fenrick remains on bond until the sentencing hearing.
The SBA-Office of Inspector General led the investigation, with assistance from the Secret Service. Assistant U.S. Attorney Shirin Hakimzadeh is prosecuting the case.
4o