Kingsport, Tennessee – A Tennessee man has been sentenced to more than five years in federal prison after prosecutors said he participated in a large COVID-19 tax fraud conspiracy that used fake businesses to steal millions of dollars from federal pandemic relief programs.
Federal officials announced that Edward Zanes, 51, of Kingsport, Tennessee, was sentenced on May 14, 2026, in the United States District Court for the Eastern District of Tennessee.
United States District Judge Clifton Corker sentenced Zanes to 65 months in prison for his role in the scheme. After completing his sentence, Zanes will also serve three years of supervised release.
Authorities said Zanes was the final defendant sentenced in the fraud case involving three people accused of exploiting federal COVID-19 relief tax credits.
Earlier this year, co-defendant Ryan Glidewell, 53, also of Kingsport, received an 84-month federal prison sentence. Another co-defendant, Alyssa Glidewell, 36, was sentenced last year to 50 months in prison.
All three defendants were ordered to serve three years of supervised release following their prison terms.
Judge Corker also ordered the defendants to pay a combined $1,806,637 in restitution to the federal government.
Fake Businesses Used to Seek Millions in COVID Relief Funds
According to court documents and statements presented during court proceedings, Ryan Glidewell, Alyssa Glidewell, Edward Zanes, and others worked together to submit false tax returns tied to pandemic-era relief programs created by Congress.
Federal prosecutors said the scheme focused on fraudulently obtaining money through the Employee Retention Credit and paid Sick and Family Leave Credit programs, which were originally designed to help struggling businesses survive during the COVID-19 pandemic.
Investigators said the defendants created at least 11 fake businesses that had no actual employees and no real operations.
Authorities alleged the businesses existed solely to fraudulently claim tax credits and secure large federal refunds.
Members of the conspiracy then allegedly filed numerous false tax returns using the sham companies and directed refund checks to addresses controlled by the conspirators.
According to federal officials, the fraudulent returns sought more than $3.4 million in refunds from the Internal Revenue Service.
Investigators said the IRS ultimately paid out approximately $1.8 million connected to the scheme before authorities uncovered the fraud.
Federal prosecutors strongly criticized the defendants for exploiting emergency relief programs created during one of the most difficult periods in recent history.
“The defendants in this case exploited governmental efforts to assist businesses during a time of unprecedented uncertainty,” said U.S. Attorney Francis M. Hamilton III for the Eastern District of Tennessee. “The U.S. Attorney’s Office, together with our law enforcement partners, will continue to vigorously prosecute individuals that steal from the citizenry through tax fraud.”
IRS Criminal Investigation officials also emphasized the seriousness of pandemic-related fraud cases.
“Edward Zanes and his co-conspirators created fake companies, filed fraudulent tax forms, and tried to steal from programs meant to help Americans during the pandemic,” said Donald “Trey” Eakins, Special Agent in Charge of the Internal Revenue Service Criminal Investigation Charlotte Field Office. “IRS CI special agents, together with our law enforcement partners, will continue to uncover COVID-19 relief fraud and hold anyone who files false tax returns fully accountable.”
The investigation was conducted by IRS Criminal Investigation and the United States Secret Service.
Assistant United States Attorneys Ryan Blackwell and Mac Heavener handled the prosecution alongside former Justice Department Tax Division Trial Attorney Zachary A. Cobb.
Federal authorities continue warning that pandemic relief fraud remains a major enforcement priority as investigators across the country pursue individuals accused of abusing programs intended to support businesses and workers during the COVID-19 crisis.
