Suburban Chicago officer indicted in alleged COVID-19 relief loan scheme

COOK COUNTY - A suburban Chicago police officer is facing federal charges for allegedly getting COVID-19 relief loans through fraud and hiding the money during a bankruptcy case.

What we know:

William Frederick Reed, 41, of Hazel Crest, has been indicted on charges including making false statements in Small Business Administration loan applications, bankruptcy fraud, and tax-related offenses.

Reed reportedly worked as a police officer in the south suburbs of Dolton and Robbins while also running a self-employed security business. 

According to a federal indictment unsealed Monday in U.S. District Court in Chicago, Reed applied for and received three Paycheck Protection Program (PPP) loans in 2020 and 2021 by falsely inflating payroll numbers for his security business.

The indictment alleges that Reed not only misrepresented the size of his business to qualify for the loans but later attempted to hide the funds when filing for Chapter 7 bankruptcy in 2022. Prosecutors say he submitted false documents and a fraudulent tax return to avoid scrutiny from bankruptcy trustees and creditors.

Reed is also accused of underreporting his income and misrepresenting tax withholdings in 2021, and of not filing federal income tax returns in 2022 or 2023.

What's next:

A date for Reed's arraignment has not yet been scheduled.

The Department of Justice continues to investigate pandemic-related fraud. Tips can be reported to the National Center for Disaster Fraud at 866-720-5721 or online.