A freight-related Paycheck Protection Program loan scam wrapped up recently with the second of two convicted Ohio women receiving her final sentencing.
In March 2024, Lorie A. Schaefer, 63, of Westerville, and Latisha C. Holloway, 42, of Reynoldsburg, were indicted on charges of orchestrating a multimillion-dollar fraud scheme involving COVID-19 relief funds. They illegally obtained more than $2.8 million in PPP loans through falsified documents and fraudulent business claims.
Schaefer fraudulently applied for nearly $1.9 million in PPP loans by claiming an affiliation with the Flying Pizza restaurant chain, fabricating financial records to support her application. She used the funds for personal expenses, including $26,000 for liposuction, a $10,000 baby gift and over $900,000 for real estate. Schaefer also assisted Holloway in securing over $980,000 in PPP loans for a fictitious business, Jaguar Logistics LLC. Holloway, in turn, wired Schaefer $180,000.
Both women pleaded guilty to wire fraud and money laundering. Holloway was recently sentenced to 15 months in prison and ordered to pay over $1 million in restitution. In July, Schaefer pleaded guilty and is paying back at least $2.89 million and forfeiting more than $2 million in assets.
KAL Freight’s fallout 😡
KAL Freight’s financial collapse is heading toward a chaotic finish, leaving over 800 drivers and millions of dollars in cargo at risk of being stranded across the country. The Texas-based carrier, which filed for Chapter 11 bankruptcy, is now facing a “do or die” moment as creditors debate how to liquidate the company.
A rapid shift to Chapter 7 liquidation could mean immediate shutdown, cutting off fuel cards and leaving drivers abandoned with loaded trailers. Triumph Financial and Daimler Truck Financial Services, two major creditors, are pushing for a structured wind-down to prevent a logistical nightmare. They warn that an abrupt closure could lead to trucks and cargo scattered nationwide, exposing assets to loss, theft or destruction.
KAL Freight’s bankruptcy is more than just a financial collapse; related claims of fraud have rocked the trucking industry. Court documents suggest that the California-based carrier defrauded Daimler Truck Financial Services of nearly $40 million through a series of fraudulent asset transfers, fake purchases and unauthorized sales.
One of the most shocking accusations is that KAL Freight obtained $16.9 million from Daimler to buy 164 trailers that never existed. The company allegedly submitted fake certificates of title with recorded liens, all while making loan payments to maintain the illusion. Additionally, Daimler claims KAL Freight illegally moved 366 financed trailers to a Canadian affiliate, where they were sold or leased to third parties, and put an additional $20 million in assets at risk.
While some creditors push for a quick shutdown, others are demanding a controlled exit to avoid a Celadon-style disaster.
Verified Carrier locks down patent to combat fraud 📄
Verified Carrier is seeking a provisional patent (U.S. Provisional Patent Application No. 63/766,249) for its innovative carrier verification process. The patent covers the company’s back-office system, which combines AI-driven automation with rigorous human verification to ensure carrier credentials are legitimate.
As freight fraud grows more sophisticated, Verified Carrier’s multilayered approach is gaining traction among top brokerages and even regulators. By leveraging extensive carrier data and direct third-party verification, the company is looking to set a new industry standard for fraud prevention. The system not only validates Federal Motor Carrier Safety Administration data but cross-checks insurance, banking and business ownership records to detect inconsistencies before fraud can occur.
“Freight fraud is an industry-wide problem, and our verification process has proven to be a critical tool in fighting it. With adoption from some of the largest brokerages and recognition from regulators, securing a patent was the next step in ensuring our technology remains a trusted industry standard,” Alex Panfilov, founder and CEO, told FreightWaves.
Learn more about the company’s work in fighting fraud here.
Registration open for May Freight Fraud Symposium in Dallas 🎉
Be part of the solution that stops freight fraud in its tracks. Let’s cut through the noise and address this issue head-on!
Freight fraud has reached a crisis level, and it impacts everyone in the industry. It’s time for us to come together to address this critical problem and share best practices on how to mitigate it.
Join us on May 14 in Dallas at the Freight Fraud Symposium, where transportation executives, freight leaders and technology buyers will come together to discuss the issues we all face, share lessons learned and get insights on the latest technology to help us tackle this problem.
Space is limited, so register now to save your spot!
Why You Should Attend the FreightWaves Freight Fraud Symposium
Shoppers fearful of crime at retail locations
3PL Summit: Truckstop reflects on 30 years of fighting freight fraud