Blueacorn's co-founders convicted and sentenced over $63 million in fraudulent PPP loans
Nathan Reis and Stephanie Hockridge, a married couple, co-founded Blueacorn in April 2020 as a Paycheck Protection Program "lender service provider" that processed applications for an FDIC-insured bank. Prosecutors said the pair and their co-conspirators submitted PPP applications containing fabricated payroll records, tax documents and bank statements, and ran a "VIPPP" service charging borrowers fees calculated as a percentage of the loan amount. Reis pleaded guilty and was sentenced in December 2025 to 10 years in prison and over $66 million in restitution; a jury convicted Hockridge of conspiracy to commit wire fraud in June 2025, and she was sentenced in November 2025 to 10 years in prison and nearly $64 million in restitution.
- Year
- 2025
- Where
- United States
- Outcome
- Sentenced
- Reported loss
- $65.0 million
- Victims
- Not stated in the sources
- Schemes
- Paycheck Protection Program (PPP) loan fraud
- Last reviewed
- 2026-10-02
The facts, as recorded
- Nathan Reis and Stephanie Hockridge (also known as Stephanie Reis), a married couple, co-founded Blueacorn in April 2020 as a 'lender service provider' that processed Paycheck Protection Program applications on behalf of an FDIC-insured bank.
- Prosecutors said Reis, Hockridge and co-conspirators submitted PPP applications containing fabricated payroll records, tax returns and bank statements, and ran a 'VIPPP' service that charged borrowers fees calculated as a percentage of the loan amount.
- Reis's plea covered more than 530 fraudulent loans totaling over $65 million; the Justice Department has separately described the scheme as processing over $63 million in fraudulent PPP loans.
- A congressional investigation found Blueacorn, based in Scottsdale, Arizona, processed over $1 billion in PPP funds overall and funded nearly three times as many loans as major banks combined.
- Reis pleaded guilty to conspiracy to commit wire fraud in August 2025 and was sentenced on December 18, 2025 to 10 years in prison and ordered to pay over $66 million in restitution.
- A federal jury convicted Hockridge of conspiracy to commit wire fraud on June 23, 2025, while acquitting her on four separate wire fraud counts.
- A federal judge in Fort Worth, Texas sentenced Hockridge on November 21, 2025 to 120 months in prison, nearly $64 million in restitution and two years of supervised release, ordering her to surrender to a federal prison camp in Bryan, Texas by December 30, 2025.
- Hockridge is a former TV news anchor at Phoenix station KNXV.
- Acting Assistant Attorney General Matthew R. Galeotti said of Reis: "This defendant orchestrated one of the nation's largest schemes to defraud the Paycheck Protection Program." Of Hockridge, Galeotti said: "This defendant exploited a national emergency to personally profit from a taxpayer-funded program."
Why this case matters
This is the largest documented case on this page, and the only one built inside a company that was meant to be part of the program’s own safeguards. A “lender service provider” is a fintech that processes loan applications for a bank so the bank itself does not have to build that infrastructure. Blueacorn’s own co-founders are alleged to have used that position not to catch fraudulent applications, but to manufacture them.
A platform, not a single fake application
Unlike a lone applicant inventing one fictional business, Blueacorn processed loan applications at scale, for real banks, inside a platform a congressional investigation found moved over $1 billion in PPP funds and funded nearly three times as many loans as every major bank combined. The fraud alleged here is not that the platform existed, it is that its own founders are accused of running fabricated applications through the same pipeline as legitimate ones.
The “VIPPP” fee
Prosecutors described a “VIPPP” service that charged borrowers a fee calculated as a percentage of the loan amount, in exchange for push-through approval, the same financial incentive, paid regardless of whether the underlying numbers were real, that recurs across every case on this page.
Two outcomes, one scheme
Reis pleaded guilty before trial; Hockridge went to trial and was convicted on the conspiracy count while being acquitted on four separate wire fraud counts, a reminder that a mixed verdict can still carry a sentence as severe as a guilty plea when the convicted count covers the core of the scheme.
The caveat
Both defendants have now been convicted, by plea or by jury verdict, and sentenced. The $63 million, $65 million and $66 million figures that appear across the government’s own releases describe the same underlying scheme measured at slightly different points, the loss alleged, the loss proven at Reis’s plea, and the restitution ordered at each sentencing, rather than three different totals.
Sources
- Co-founder of Paycheck Protection Program Lender Service Provider Sentenced to 10 Years in Prison for $63M COVID-19 Relief Fraud Scheme. US Department of Justice, Office of Public Affairs. Accessed 2026-10-02. Supports: Reis's age, co-founding Blueacorn, the fabricated documents, the over 530 fraudulent loans, over $65 million in losses, his guilty plea, 10-year sentence, over $66 million restitution, and the Galeotti and Raybould quotes.
- Founder of Lender Service Provider Convicted for Role in Multimillion-Dollar PPP Fraud Scheme. US Department of Justice, Office of Public Affairs. Accessed 2026-10-02. Supports: Hockridge's age, her June 23, 2025 conviction for conspiracy to commit wire fraud, her acquittal on four wire fraud counts, the 'VIPPP' kickback fee structure, and the Galeotti quote about exploiting a national emergency.
- Blueacorn Co-Founder Stephanie Hockridge Sentenced to 10 Years for $63 Million PPP Loan Fraud Scheme. AZFamily (KTVK/KPHO, Phoenix). Accessed 2026-10-02. Supports: Hockridge's November 21, 2025 sentencing in Fort Worth, Texas, her 120-month sentence, nearly $64 million restitution, two years of supervised release, the December 30, 2025 surrender date, her KNXV news anchor background, and the congressional investigation's $1 billion and triple-the-major-banks figures.