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Former owner of Criminal Coffee convicted in federal court of fraud
It seemed offbeat, somewhat in-your-face and a bit edgy for a small town.
But as it turns out, the name was right on target.
The former co-owner of the Friday Harbor coffee shop formerly known as "Criminal Coffee" was ordered to serve 366 days in federal prison after pleading guilty in U.S. District Court to one count of wire fraud.
As part of the sentence handed down Feb. 27 in a Seattle federal courtroom, Ramona Hayes, 41, was also ordered to pay $43,000 in restitution to the U.S. Social Security Administration and $15,350 to the Washington Department of Social and Health Services. She was taken in to custody by U.S. marshals immediately after sentencing and will serve out the sentence in a federal penitentiary in Dublin, Calif.
Hayes and former co-owner Cory Eglash were indicted on a series federal charges nearly one year ago for falsifying their employment status and allegedly conspiring to defraud federal and state agencies out of disability payments. Eleven of the 12-count indictment against Hayes were dismissed at the time of sentencing.
The case against Eglash is still pending, according to Steve Lowe, senior director of DSHS' fraud and accountability division.
Eglash and Hayes renamed their Tucker Avenue enterprise Criminal Coffee after purchasing the business from the property owner in 2010. The shop has since been closed.
Shortly after buying the business, Eglash said in an interview with the Journal that the couple renamed the shop Criminal Coffee to put to rest rumors that had been circulating about Hayes' background after she proposed starting a transportation service on the island for senior citizens.
The Journal article noted that in 2003 Hayes pleaded guilty in Carson City, Nev., to embezzling $1,200 from a senior services-related non-profit of which she was president, and to forging a letter indicating another organization she was associated with had received a grant to build a new senior center. She was sentenced to three years probation and ordered to pay restitution; at that time she had no prior convictions.
In early 2013, Hayes and Eglash became the subject of a joint federal-state investigation after DSHS received a tip that Hayes was using her state-issued electronic benefits card to purchase supplies for the coffee shop. In seeking disability benefits, Hayes claimed that she was unable to work due to anxiety, depression and PTSD, filing paperwork that said, "… most days I cannot leave the house and cannot accomplish anything due to depression and anxiety," according to the federal indictment.
Investigators discovered that Hayes had been using the card to buy supplies for the shop. They also found she did not report owning the business, or receiving any income from it, and lied about a child being in her home when the child had been in Oregon with his father when she applied for and received food benefits and Social Security disability benefits, according to DSHS.
Hayes is one of two Washington residents recently sentenced to federal prison for defrauding DSHS and the Social Security Administration, and one of four ordered to pay restitution to the public agencies.
An Auburn woman was ordered to serve two years in prison for concealing from an elderly man that resulted in her collecting $8,000 in Social Security disability benefits, and another $8,724 of food and medical benefits from DSHS to which she was not entitled. She was also ordered to pay $400,000 in restitution to the man.