Charlotte City Council member Tiawana Brown and her daughters have been charged with fraud related to pandemic-era relief funds, the U.S. Attorney for the Western District of North Carolina said Thursday.
The indictment is only the second time in Charlotte's history that a sitting elected municipal official has faced federal charges. In 2014, then-Mayor Patrick Cannon was arrested and charged with accepting bribes from an undercover FBI agent to help a developer. He resigned and pleaded guilty, and was sentenced to almost four years in prison.
Brown, 53, and her daughters, Tijema Brown, 30, and Antionette Rouse, 33, face federal charges of wire fraud conspiracy and wire fraud. U.S. Attorney Russ Ferguson said the charges stem from fraudulent applications to obtain COVID-relief funds meant for small businesses. Ferguson was appointed in March, and he said on Charlotte Talks Thursday morning that the investigation had been in progress for some time before he assumed the post, under the previous U.S. Attorney.
"Basically, what the allegations are is that she applied for COVID relief money using false information and false forms. She attached IRS forms that were not real and not actually submitted to the IRS, made false statements on the applications, and got taxpayer money in return. So those, those are the allegations and again, just allegations," he said.
In a press conference Thursday, Brown said she will not resign and that she plans to run for reelection for her District 3 seat on Charlotte City Council. She said that when she became aware of the investigation, she repaid the portion of the loans she was responsible for, totaling more than $20,000. She said the prosecution is politically motivated.
"Unfortunately, on this day, I can say that justice don’t always look like people like me," she said.
She also said: "I haven't been convicted of anything. I was elected by the people and for the people."
According to the indictment, Brown and her daughters filed false applications and fraudulent tax forms and received at least $124,165 worth of Paycheck Protection Program loans. They spent the funds on non-business expenses, including Louis Vuitton merchandise and $15,000 on a birthday party for Tiawana Brown that included "a balloon arch, a rose wall, a rented throne and a horse-drawn carriage," according to the indictment. The U.S. attorney says she paid for the party using a bank account for her nonprofit organization, which focuses on helping formerly incarcerated women.
In the news conference, Brown was asked whether she used the loans for payroll, which was the intent of the program.
Brown's attorney, Rob Heroy, declined to answer.
He also declined to answer questions about the birthday party mentioned in the indictment.
Brown said the loan was legitimate.
"I had a business to seek the funding," she said. "I was starting a new business."
She said that business was TCCollections, a women's clothing line that has a Facebook page. The state, however, has no record of TCCollections as an incorporated business.
PPP loans were also meant for businesess that had been in existence before the pandemic.
Heroy said he didn't want to talk about the specifics of the businesses.
"We don't to give our entire playbook to the other side as we are getting ready for trial," he said.
The indictment says Brown and her daughters used other people's names and Social Security numbers, as well as fraudulent details and fake tax documents about businesses they supposedly operated, to obtain the loans.
In one application, Brown said she was the sole proprietor of a "health services" business that had operated since April 2018, employed eight people and had $142,000 in gross revenue, according to the indictment. In another, Tijema Brown said she was the owner of an "entertainment services" company with $15,500 in gross revenues and two employees. Some of the applications were rejected, while lenders provided cash advances and loans for others.
The PPP program was created during the pandemic to help businesses with payments so they wouldn’t lay off employees as the economy foundered.
The charges carry a maximum sentence of 20 years in prison.
“These allegations concern actions that took place before I took office," Brown said Thursday. "I have always been transparent about my past and have worked tirelessly to serve my community with integrity and dedication.”
Brown had previously served several years in federal prison. She was pregnant and in her 20s when she was sent to federal prison in West Virginia on a felony fraud conviction.
She was the first formerly incarcerated person elected to Charlotte City Council, when she won her seat representing District 3 in 2023, and her story of being imprisoned and then finding redemption has been a core part of her message.
Brown founded a nonprofit organization called Beauty After the Bars, focused on women who have been incarcerated and are transitioning back home.
Court records show Brown has continued to face legal troubles, many centered around money. Federal court records show she was still facing garnishment and repayment as late as 2010 from her federal case in the 1990s. The government filed to garnish her funds to satisfy an unpaid judgment balance of $53,093 in fines and restitution. She and the government agreed on a payment plan.
She is also named as a defendant in four separate eviction filings in 2024, all by the same landlord, for unpaid rent.
This is a developing story and will be updated.
