A federal grant intended to expand high-speed internet access in rural Nevada became the source of more than $7.8 million in misappropriated funds, according to federal prosecutors.
The U.S. Attorney's Office for the District of Nevada announced Tuesday that Stephen A. Kromer pleaded guilty to one count of federal money laundering. Kromer owned Uprise LLC, a Reno-based internet service provider that received a $27 million federal grant for a broadband construction project near Lovelock in 2022.
The project, known as the Lovelock Project, was funded through the U.S. Department of Agriculture's ReConnect Program, which supports high-speed internet construction in rural areas across the country.
As part of the grant agreement, Uprise was required to contribute about $9 million toward the project. The company obtained that money from the state of Nevada and deposited it into a separate account designated for the Lovelock Project and overseen by the USDA, according to court documents.
From May through November 2024, Kromer transferred more than $7.8 million from that account into his personal bank account, falsely recording the transfers as expenses for the broadband project, prosecutors said.
The indictment also alleged that Kromer moved the money from his personal account into accounts at various cryptocurrency exchanges, where it was converted into cryptocurrency.
Federal officials said the case involved money intended to improve broadband access in rural communities. The U.S. Attorney's Office for the District of Nevada, the FBI and the USDA Office of Inspector General investigated the case.
Kromer is scheduled to be sentenced March 9, 2027. He faces a maximum statutory penalty of 20 years in prison. The court will determine his sentence after considering federal sentencing guidelines and other statutory factors.
