Second Southern Colorado Funeral Home Operator Sentenced To 18 Years In Federal Prison After Pleading Guilty To Defrauding Grieving Families, COVID-19 Funds

DENVER - The United States Attorney's Office for the District of Colorado announces that Carie Hallford, 49, of Colorado Springs was sentenced to 216 months in federal prison, three years of supervised release, and $1,070,413.74 in restitution after pleading guilty to conspiracy to commit wire fraud.

Hallford, who owned and operated Return to Nature Funeral Home in Colorado Springs and Penrose with her then husband and codefendant, Jon Hallford, mishandled at least 190 bodies over four years and defrauded the Small Business Administration (SBA) through fraudulent COVID-19 loan applications. Jon Hallford was sentenced in June 2025 to 240 months in federal prison and ordered to pay $1,070,413.74 in restitution for his role in the conspiracy.

According to the plea agreement, from as early as September 2019 through October 2023, Hallford and her husband failed to cremate or bury at least 190 bodies, despite having collected more than $130,000 from grieving families for funeral services that were never provided. The defendants failed to provide the basic core service it promised to some of its customers, either a cremation or a burial, and continued to collect payment from victims for funeral services and goods.

The plea agreement further states that Carie Hallford handled much of the banking, invoicing, contracting with customers, filing of required paperwork, bookkeeping and communications with customers. Both defendants routinely prepared death certificates for the deceased and then filed those certificates with the State of Colorado's Electronic Death Registry. On many of the death certificates for the bodies found at the Penrose location, the defendants falsely stated that the "method of disposition" was by either cremation or burial when in truth there was no disposition as the bodies were left decomposing at the Penrose location. To carry out and execute the above fraud scheme, the defendant and her husband worked together to cause multiple interstate wire communications to occur.

The plea agreement goes on to state that from March 2020 to March 2022, Hallford and her husband conspired to defraud the SBA by submitting loan applications containing false information to obtain COVID-19 relief funds. As a result of this fraud, they received three separate disbursements from the SBA, totaling $882,300. The funds were obtained through the Economic Injury Disaster Loan (EIDL) program, which was established to provide emergency support to businesses affected by the COVID-19 pandemic.

On October 5, 2023, federal and state officials searched the Penrose location, where they discovered multiple decomposing human remains in hazardous conditions. The toxic environment posed serious health risks to first responders and the public, requiring hazmat suits and strict decontamination protocols. The EPA later condemned and demolished the building, classifying it as a toxic waste site.

"It takes an exceptionally sick person to even think of a fraud scheme like Jon and Carie Hallford's, let alone carry it out. Their disregard for fundamental human dignity is almost beyond belief," said United States Attorney for the District of Colorado Peter McNeilly. "I hope the victims take some solace in the serious sentences handed down to both Hallfords. This case doesn't right the wrongs the victims have suffered, but it does stand as an unequivocal condemnation of the Hallfords' horrific criminal conduct."

"The defendant defrauded grieving families she agreed to serve while deceiving the federal government in order to obtain benefits meant to assist businesses during the pandemic," said FBI Denver Special Agent in Charge Amanda Koldjeski. "She denied families well deserved dignity and showed blatant disregard for government rules. She lied and exploited families and systems to enrich her lifestyle with absolutely zero regard for the great harm she caused to so many."

The District of Colorado's U.S. Attorney's Office heads one of five national COVID-19 Fraud Strike Force Teams, which is focused on combatting and preventing COVID-19 related financial fraud. The Strike Force combines law enforcement and prosecutorial resources and focuses on large-scale, multistate pandemic relief fraud perpetrated by criminal organizations and transnational actors, as well as those who committed multiple instances of pandemic relief fraud. The Strike Force uses prosecutor-led and data analyst-driven teams to identify and bring to justice those who stole pandemic relief funds. Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice's National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form

United States District Judge Nina Y. Wang presided over the hearing.

The FBI Denver Field Office and the United States Small Business Administration Office of Inspector General investigated the case. Several other state and local law enforcement agencies including the Colorado Bureau of Investigation, the Colorado Springs Police Department, the El Paso County Coroner's Office, the Fremont County Sheriff's Office, and the Fremont County Coroner's Office have made significant contributions to this case.

The prosecution was handled by Assistant United States Attorneys Tim Neff and Craig Fansler.

Case Number: 1:24-cr-00113-NYW