courthouse.jpg

A Portland woman is set to be arraigned Friday morning on a 47-count indictment charging her with multiple allegations of first-degree theft, unlawfully obtaining public assistance, first-degree aggravated theft and unlawfully obtaining food stamps.

(Aimee Green/The Oregonian)

A Multnomah County grand jury has returned a 47-count indictment against a woman accused of multiple counts of welfare fraud spanning a seven-year period.

Katie Lorraine Burns, 27, claimed she was unemployed, didn't have a checking account and was the only adult in her household on multiple applications for government subsidies from the state Department of Human Services, investigators said.

But she was actually working for her family's oil recycling business and deposited $250,000 into a joint checking account shared with her boyfriend, investigators said. Her boyfriend was convicted earlier this year in a separate case of running an illegal auto dismantling business in North Portland.

Katie Lorraine Burns

The grand jury indictment charges Burns with 21 counts of first-degree theft, 16 counts of unlawfully obtaining public assistance, six counts of first-degree aggravated theft and four counts of unlawfully obtaining food stamps.

She's accused of defrauding Oregon's Department of Human Services of $192,551.47 in benefits based on false information provided in 16 applications for welfare benefits between 2008 and 2015, according to a probable cause affidavit filed in Multnomah County Circuit Court.

Burns is accused of fraudulently obtaining benefits from the Cash for Families, Temporary Assistance for Needy Families, Employment-related Day Care Program, Supplemental Nutrition Assistance Program and Oregon Health Plan, the affidavit said.

Christy Sinatra, a spokeswoman for the state Department of Human Services, called the extent of the alleged public assistance fraud rare.

"This case and all fraud cases of any kind are unfortunate because they undermine the programs we offer to Oregon families who truly need help to be healthy and stable to work their way out of poverty,'' Sinatra said.

Burns deposited more than $250,000 in apparent income into her checking account as she was collecting welfare checks, including health care and child care coverage and food stamps, between May 2008 and November 2015, the investigator found.

On her applications for welfare, Burns insisted that she didn't know where the father of her children lived and didn't want him contacted for his child support obligations, authorities said. Yet investigators subpoenaed her children's child care and school records and found their father, Ryan Zimmers, was listed as part of the family living in the same household as the children's mother, Burns.

The investigation of Burns grew out of a 2014 investigation into an alleged illegal car-crushing scheme and racketeering case involving two North Portland auto yards.

Ryan Zimmers

Zimmers was identified as bringing vehicles to one of those yards to be crushed. Further inquiry found that residents had complained that Zimmers was stripping cars of parts in the middle of the street outside his home in the 9100 block of North Exeter Street.

Portland police discovered that Zimmers was sawing out catalytic converters and removing wheels and radiators from cars on his street, although he didn't have a valid auto dismantler's license to conduct such work, let alone on a city street, according to court documents.

At one time, Zimmers had a dismantler's license from the state but it was for a burned-down location elsewhere, on North St. Louis Ave., according to court records.

The grand jury in Burns' case reviewed records from a Tacoma company that paid Zimmers $360,897 in cash for catalytic converters between February 2012 and February 2016, the affidavit said.

Zimmers has now been indicted on new charges, accused of five counts of money laundering and criminal conspiracy to obtain food stamps fraudulently.

An officer with the Multnomah County Sheriff's Office arrested Burns at 1:32 p.m. Thursday at 2525 N.W. 28th Ave., according to jail records.

She was booked into the downtown Portland jail and released. She was arraigned in Multnomah County Circuit Court Friday morning and entered not guilty pleas to the indicted charges. Her next court date is Oct. 21.

Authorities ask that anyone with information about Burns or Zimmers should contact Michael Glenn, criminal fraud investigator with the state Department of Human Services, at 971-673-2490.

The Oregon Department of Human Services encourages the public to report suspected fraud to its hotline at 1-888-372-8301 or submit a report online.

-- Maxine Bernstein

mbernstein@oregonian.com

503-221-8212

@maxoregonian