Third Memphis defendant sentenced in multi-state COVID-19 unemployment and Tennessee emergency cash assistance fraud case

Federal court closes sentencing phase for three-defendant Memphis fraud case

A federal judge in Memphis has sentenced Karen Guevara, 38, to one year and one day in prison, followed by three years of supervised release, for her role in a scheme that targeted pandemic-era relief programs. The sentence was imposed on Feb. 13, 2026, in U.S. District Court, and announced publicly on Feb. 20, 2026.

Guevara pleaded guilty to conspiracy to commit wire fraud and making false claims against the United States government. Court filings described a fraud operation that relied on false applications and fabricated employment documentation to obtain benefits intended for people facing job loss and income disruption during the COVID-19 emergency.

How the scheme worked and what investigators quantified

Authorities said Guevara and co-conspirators filed fraudulent applications for unemployment benefits across more than 20 states during the first year of the pandemic. The total loss attributed to the unemployment component exceeded $560,000.

The group also obtained funds from Tennessee’s federally funded Emergency Cash Assistance (ECA) program. Prosecutors said the defendants used fake employment termination notices—created for themselves and others—to qualify for payments tied to pandemic-related unemployment. The loss to the ECA program was described as approximately $20,000.

• Primary federal program affected: pandemic-related unemployment benefits across multiple states
• Tennessee program affected: Emergency Cash Assistance (ECA), administered by the state using federal funding
• Methods alleged in court: fraudulent applications and fabricated termination or unemployment documentation

Related Memphis defendants and earlier sentences

Guevara is the third Memphis woman sentenced in the same set of schemes. Two other defendants were previously sentenced:

• Deashley Tabor, 37: sentenced to 41 months in federal prison
• Rochelle Turner, 32: sentenced to five months in federal prison, followed by five months of home detention

In Turner’s case, prosecutors said she created and submitted fraudulent unemployment letters and attempted to obtain more than $15,000 from the ECA program, with an actual loss of $6,000. Turner pleaded guilty on May 8, 2025, and was sentenced on Aug. 14, 2025.

Oversight and enforcement

The investigation involved federal and state oversight bodies focused on pandemic-relief program integrity, including inspector general offices responsible for safeguarding unemployment insurance and health and human services programs, as well as Tennessee’s human services program-integrity functions. The prosecution in the Memphis case was handled in federal court in the Western District of Tennessee.

The sentencing of the third defendant concludes the court’s punishment phase for a case that combined multi-state unemployment fraud with fabricated documentation submitted to Tennessee’s emergency cash assistance program.