Hanford Patrol officer fired, sentenced for federal COVID fraud in side business

A Pasco gun dealer who also worked for the Hanford Patrol has been sentenced to two years probation but no jail time after pleading guilty to defrauding the federal government in his private business.

Leif Gerald Larsen was sentenced Wednesday by Judge Stanley Bastian in the Yakima U.S. Courthouse for wire fraud related to U.S. government loans intended to help small businesses remain afloat during the COVID pandemic.

Larsen worked with a co-defendant to submit false information and documents to apply for more than $158,000 in a federal loans, much of which he could then apply to have forgiven and not pay back, according to court documents.

Larsen worked as a Hanford Patrol logistics officer at the time of the crime involving his private firearms business, and his previous work included special projects with undercover operations on matters of national security that remain classified, according to documents.

Due to the charges filed against him in federal court, he lost the job he held for more than seven years at the Hanford nuclear site about a month before he pleaded guilty in March 2025, according to court documents. He was charged in March 2024.

Among the customers for his business were Hanford security and other law enforcement officers who purchased special types of weapons and suppressors he had a federal license and tax permit to sell, said documents. Fraudulent loan applications

In February and March 2021 he worked with Kelly Jo Driver, one of three defendants in the case, to submit a request for two Coronavirus Aid, Relief and Economic Security Act, or CARES Act, loans.

He received a $149,100 CARES paycheck protection loan, which was eligible to be forgiven.

Fraudulent CARES ACT payments harmed other small businesses because the federal loan program lacked enough money to help all of those that applied, the Eastern Washington U.S. Attorney’s Office has previously said.

To get the loan, Larsen and Driver lied and said that Larsen Gunsmithing & Firearms had 10 employees and an average monthly payroll of about $59,700. They also submitted a false payroll register and false Internal Revenue Service forms, according to court documents.

After receiving the loan, Larsen sent $15,000 to Driver.

Larsen, with Driver’s assistance, also applied for a $9,000 CARES Act Economic Injury Disaster Loan, but canceled it when he was interviewed by federal agents.

He had falsely claimed to have 10 employees at Larsen Firearms to meet eligibility requirements for that loan.

Assistant U.S. Attorney Tyler Tornabene asked the court to sentence Larsen to 10 months incarceration and no fine, which was at the low end of the sentencing range. Larsen paid back the money he obtained by submitting false documents and has no criminal record, Tornabene said in a court document.

“While this is not a no-harm-no-foul situation, it does show that defendant quickly took steps to accept responsibility for what he did long before being indicted,” Tornabene said in the document.

Larsen’s attorney, Gregory Scott, of Yakima, said in court documents that Larsen was remorseful and had worked to make amends, including contacting the FBI within days of receiving the $149,100 loan.

Scott asked that Larsen be sentenced only to probation, which he said was in line with the sentence for some other COVID loan fraud sentences. Co-defendent fraud sentences

Driver was sentenced in May to five years probation after helping both Larsen and also a third defendant in the case, David “Kurt” Schneider, prepare false paperwork to obtain CARES loans.

She is also jointly liable with Schneider to repay nearly $121,800 in loans he received.

Schneider also was sentenced in May to a year and one day in prison after pleading guilty to conspiracy to commit wire fraud to obtain money through federal COVID-19 relief programs.

Schneider falsified information in the loan application to obtain money to develop a solar-powered wheelchair, according to his attorney.

Schneider also submitted false applications for loans for his purported companies RealNZ Water and Tempest Tactical Solutions, although there was no evidence they existed other than to be used to apply for CARES Act loans, according to court documents.

Schneider, who worked at the Hanford site vitrification plant in 2020 and 2021, told Larsen that he could obtain CARES Act money using false and inflated numbers of employees, according to court documents.

Schneider introduced Larsen to Driver, who charged a percentage of funds received for her help, according to court documents.