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Petal Mayor says Ross’s PSA move “a great last-minute political stunt to get some votes,” but isn’t a solution for sports program.

Hattiesburg Patriot
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Petal Mayor says Ross’s PSA move “a great last-minute political stunt to get some votes,” but isn’t a solution for sports program.

Revenue problems and proposed budget cuts have threatened the future of the Petal Sports Association (PSA) in recent weeks, but Petal’s primary sports organization is back in the game, at least for now, with $100,000 in funding from the Forrest County Board of Supervisors.

The one-time sponsorship comes from a surplus in the recreation budget of District 3 Supervisor Burkett Ross, who said he’s built the surplus during the eight years he’s held office. Reaction from citizens has been mixed. While many seem to think Ross has knocked it out of the park with this contribution, comments from others indicate that the county’s gift is a swing and a miss.

“Now that’s news!! I’m so happy to hear this,” Jen Hartfield Pulliam posted. “When one door closes another opens. They truly see the meaning of this and want to insure that every child has a [sic] opportunity to shine!”

Brushbacks on Facebook say Ross stepped up to the plate on the eve of elections and is grandstanding before voters head to the polls Tuesday. Some commenters ask why sports programs in McLaurin, Brooklyn, Rock Hill and other communities have not received funding. Others point to infrastructure and sewer issues that could have been addressed with the county’s surplus.

“That is wonderful. BUT what about all the kids on the South End of the County? The ones that we have to beg and plead for money to fix ballfields and buy equipment for?” asked Christine Moody….” On WDAM’s Facebook page. In later comments she added “We have to go and beg for the crumbs they pass out down here!!” and “I don’t begrudge any kid the financial support they need and deserve, but by God spread it around!”

Maranda Dickinson agreed. “Really? What about the ball fields and play grounds in the south end of the county? Maybe the board needs to take a ride to mclaurin and carnes [sic] and have a look.”

“Still not voting for him. He hasn’t done anything for our county,” said Michelle Walters Strebeck on WDAM’s page. “This is a political move and I’m not buying it.”

“Why did he have $100,000 surplus in his budget for eight years is my question?” Carol Vogel McGee posted on Hattiesburg Patriot. “Why didn’t he help Petal before with this money as our Supervisor? Held it all till a few days prior to election after eight years of holding it? Forrest County Politics as usual.”

Debbie Hunt did not accept that line of thinking and instead praised Re-Elect Burkett Ross for County Supervisor in her comment on the HP site. “If you did [sic] for political motives, then kudos to you! Well played! But knowing the heart you have for children, I know you did it for them.”

Money from the county will be used for uniforms, helmets and other sports supplies children need, according to a Facebook post by Petal Mayor Hal Marx. He noted that Ross stipulated that he would have a problem with using the funds for cutting grass.

“The problem we face is with maintenance of the fields. This donation does nothing to help with that,” Marx said. He added that because this appears to be a one-time donation, “…the long-term issue also remains. This is a great last-minute political stunt to get some votes…but it truly does nothing to guarantee that the present arrangement between PSA and the city continues.”

Marx has posted previously on Facebook to explain the financial losses the City of Petal has incurred since it joined forces with PSA, a nonprofit, in late 2017. You can read the original agreement for the PSA-Petal joint venture here.

PSA has increased its offerings and registrations but the revenue it generates does not cover the bases, Marx said. He reported that PSA returned just over $100,000 from its revenues each year to the city, but said Petal has spent almost $800,000 annually, mostly to maintain sports complexes and pay Athletic Department staff members.

“After two years, the aldermen and I have reached the conclusion that this situation isn’t sustainable…. No business can continue to spend $700,000 per year more than it brings in,” he said. According to Marx, PSA rebuffed the City of Petal’s attempts to discuss a solution that would cost less in taxpayer funds and depend more on volunteer efforts, and instead took the debate public.

In a PSA budget meeting last Monday, association president Derek Hall outlined several cost-cutting measures that are in the works. He said PSA has consolidated some programs and will lease fields and grow its sponsorship program to increase its revenue. Also, Hall said, PSA will stop providing free football equipment to players and will increase registration fees to align them with fees charged elsewhere. Discussions between PSA and the City of Petal continue.

DALE BEAVERS CAUGHT CLAIMING MARRIED WOMAN AS WIFE IN ADULTEROUS RELATIONSHIP

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DALE BEAVERS CAUGHT CLAIMING MARRIED WOMAN AS WIFE IN ADULTEROUS RELATIONSHIP

This story was 1st reported by Hattiesburg Patriot News Media and picked up by the Clarion Ledger.

From the CL

Dale Beavers didn’t think running for office would cause so much controversy. But the actions of his past and the woman of his future have turned into fodder for a hostile feud that could end his political career before it gets started.

As his campaign for Forrest County justice court judge kicks off, he is subject to claims of adultery, questions about his troubled legal past and calls of hypocrisy — for his having blasted other local politicians over similar issues in the past.

Read more here…

https://www.clarionledger.com/story/news/2019/03/19/candidate-under-fire-relationship-married-woman-hypocrisy/3128749002/

 

 

Supervisor Burkett Ross $16,230 and three years behind on property taxes.

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Supervisor Burkett Ross $16,230 and three years behind on property taxes.

Forrest County Supervisor Burkett Ross is three years and $16,230 behind on his property taxes for two buildings he owns. Both buildings are located at 908 Main Street in Petal Mississippi. According to tax records Ross owes the following back taxes:

Old Southern Lanes Building:

  • 2018 – $3891.50
  • 2017 – $1739.21
  • 2016 – $4191.21

Total – $9821.92


Old Skating Rink Building:

  • 2018 – $1240.25
  • 2017 – $1663.33
  • 2016 – $3505.44

Total –  $6409.02

Ross must pay his taxes for 2016, which total $7196.55, in full to avoid losing the properties at a tax sale. If his 2018 taxes are sold at a tax sale before he pays his 2016 taxes he could lose the properties altogether. 

Ross, along with others affected by the 2017 tornado received a reduction in their property taxes for 2017. This is why those tax years are much lower than 2016 and 2018.

Below are the tax records from Forrest County Chancery Court.

Bowling Alley

BRoss1

 

Skating Rink

BRoss2

Nick Calico was fired from MHP for changing CDL test score results to pass unqualified drivers.

Hattiesburg Patriot
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Nick Calico was fired from MHP for changing CDL test score results to pass unqualified drivers.

Click to enlarge

Nick Calico, a 2019 candidate for Forrest County sheriff was one of six civilian employees of the Mississippi Highway Patrol Troop J Driver’s Services Division who were fired for changing scores for some test takers who were seeking commercial drivers’ licenses (CDLs). That’s according to a 1998 Hattiesburg American article by Nikki Maute. The article quotes Calico’s then-attorney, the late J.B. Van Slyke, as stating that the dismissals were “arbitrary and capricious” because others involved did not receive the same punishment; one trooper was fired, but four others were allowed to retire. Calico and two other civilian employees sought reinstatement to their positions and back pay.

The actions on the part of Calico and others enabled applicants to obtain CDLs and operational hazardous materials and passenger endorsements, without meeting the required minimum state and federal testing mandates.

Van Slyke, Calico’s attorney, said that Calico and the two other civilians changed the test scores at the request of their supervisors and did so without accepting payment, “̒ but occasionally did get restaurant gift cards from their supervisors.’” The dismissals and retirements followed a six-month investigation into whether Division J staff members took part in a scheme to sell commercial drivers’ licenses and tamper with vehicle titles.

The article quotes then-district attorney Lindsay Carter as saying the case would be presented to the grand jury for a decision on whether to file criminal charges. The Hattiesburg Patriot did not locate any court documents to indicate that criminal charges ever were filed.

Nick Calico bases his campaign to become the next Forrest County sheriff on more than two decades of law enforcement experience. His “Pick Nick” page on Facebook lists jobs with the Purvis Police Department, the Hattiesburg Police Department and the Forrest County Sheriff’s Department.

City must repay over $500k in federal funds connected to HOME program under Dupree Administration

Hattiesburg Patriot
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City must repay over $500k in federal funds connected to HOME program under Dupree Administration

Hub City residents owe more than half a million dollars to repay Uncle Sam for federal monies that the City of Hattiesburg administered improperly through its HOME program, which is designed to help low- and very-low income residents become home owners or find affordable housing.
That hit to local pockets was announced following an September 2018 audit report of the city’s use of almost $1.2 million it received from the U.S. Department of Housing and Urban Development (HUD) from 2013-17. HUD’s Office of the Inspector General (OIG) audited the HOME program at the request of Mayor Toby Barker.

The city’s HOME Program operated for several years as part of the city’s Department of Federal and State Programs. It returned to the Department of Urban Development when Mayor Barker took office and combined the two departments. Almost half of the $1.2 million Hattiesburg received during the four-year audit program, $506,000, must be repaid by the city from non-federal funds, according to the OIG’s recommendations to HUD. Here’s the breakdown on that:

1. $441,202 is for unsupported costs, which refers to costs that are charged to the program but are not supported with the proper documentation.
2. $33,258 is for ineligible costs, meaning they are not allowed by law, contract, or policies or rules of federal, state and/or local government. In this case, the City distributed the funds before there were executed written agreements.
3. $32,019 is for funds that were not committed within the 24-month deadline set by federal statute. This falls under a category called funds that could be put to better use and can refer to anything from reductions in outlays to avoiding unnecessary expenditures. In this case, the OIG recommends that HUD recapture and de-obligate this amount in 2015 funds that were not committed on time.

THE OIG WANTS MORE THAN MONEY, THOUGH

The OIG recommends that the City develop procedures and train employees to ensure that financial commitments are entered into IDIS accurately to maintain data integrity and that the HOME Program is managed according to requirements set by HUD and by the City.

Also, the OIG recommends that HUD have the City verify that there is proper documentation to support the 14 financial commitments remaining from the audit period (January 1,2013, through December 31, 2017), as well as that those commitments are accurately entered into IDIS (Integrated Disbursement and Information System). IDIS is a national data that tracks allocated HUD funds and provides the agency with current information on the status of HOME Program activities. HUD uses the information in its reports to Congress and in monitoring grantees; grantees use IDIS to enter financial commitments, draw down HOME funding and report on how
the funding is used.

A CLOSER LOOK

Specific findings of the OIG Audit are:
1. The City did not always provide the necessary documentation for its financial commitments or commit funds within the time-frame required by HUD.
2. The City’s written agreements did not always meet HUD’s requirements. For example, many were not signed or not signed completely.
3. The City’s financial commitments for HOME were not always entered HUD’s computerized tracking system in a timely manner.
4. The City did not always take care that its allocations met its own affordability period requirements. This, the OIG states, occurred because the staff was not fully aware of the requirements set by HUD and by the City, and because the City lacked sufficient procedures to ensure that its financial commitments complied with HUD timing requirements.

Those above four findings resulted in the following administrative failings in the HOME Program:

1. The City used $441,000 in funding inappropriately.
2. The City threw $32,000 away by not committing funds within the deadline period.
3. The City disbursed more than $33,000 in funding before any written agreements were executed.
4. There was no confidence at HUD or the City that the HOME Program was
administered according to requirements set by HUD and the City.
5. The City compromised the integrity of the data in IDIS and reduced HUD’s ability to rely on that data.

The City’s response to a draft copy of the audit, from Urban Development Director Andrew Ellard, explains events surrounding many of the HOME Program administrative irregularities and asks that several of the findings – and amounts due back – be dropped from the report. However, the OIG’s response to that letter denied those requests, primarily based on HUD regulations, requirements and procedures.

Mayor Dupree’s former campaign manager and close friend, Kenneth Fairley, was convicted of fraud related to the HOME program. He is due to be released this March where he will serve six months in a halfway house.

Carl Nicholson’s Charges Summarized

Hattiesburg Patriot
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GRAND JURY CHARGES:

NICHOLSON CONSPIRED TO DEFRAUD, LIED ON TAX RETURNS, AND ‘WILLFULLY’ HELPED PREPARE FALSE TAX RETURNS

Hattiesburg accountant Carl Nicholson has been charged since July 2018 with 11 tax-related felonies: one count of conspiracy to defraud the United States of America; four counts of making a false statement on an income tax return; and six counts of willfully aiding and assisting in preparing a false tax return.

Court documents filed December 18 in a superseding, or revised, indictment clarify those charges. When Nicholson appears for trial – scheduled for 9 a.m. January 14, 2019 – he will face a charge of conspiracy to defraud the federal government carried out with a local attorney identified in court documents as J.L., and with five additional counts of willfully helping to prepare a false return for J.L. and for the attorney’s company, identified as JLPA.

Nicholson also will respond to charges that he falsified expense and income reports on joint tax returns filed from 2012 – 2015 for (presumably) a Forrest General Hospital employee, who is not identified in the indictment.

Nicholson’s trial before Judge Keith Starrett will take place in Courtroom I of the William Colmer Federal Building in Hattiesburg.

COUNT 1, CONSPIRACY TO DEFRAUD THE IRS
Conspiracy to defraud the United States of America is a violation of Section 371 of Title 18 of the United States Code. The indictment alleges that, to carry out their conspiracy, Nicholson and J.L.:

• falsely classified personal expenses paid from law firm funds as business expenses in the books and ledgers of JLPA.
• prepared false individual and corporate income tax returns.
• worked to hide the purpose of the conspiracy and their actions to further it.

Specifically, federal prosecutors allege the following violations of Section 7206(1), Title 26 of the United States Code.
:

1. From approximately January 1, 2012, until approximately April 15, 2015, J.L. directed others to classify personal expenses paid from JLPS funds as business expenses in the books and records of the firm.

2. During this same period, Nicholson reviewed and signed JLPA monthly financial reports that he knew falsely classified J. L’s personal expenses as business expenses.

3. Somewhere around July 10, 2012, Nicholson instructed an employee to falsely classify a $250,000 payment for a trust as legal fees incurred by JLPA.

4. Nicholson and J.L. prepared false U.S. Corporation Income Tax Returns (Forms 1120) for JLPA for calendar years 2012, 2013 and 2014.

5. Nicholson and J.L. prepared false U.S. Individual Income Tax Returns (Forms 1040) for calendar years 2012, 2013 and 2014.

6. Somewhere around November 3, 2014, Nicholson and J.L. saw to it that check
# 5740 in the amount of $25,000 was falsely classified as an accounting expense of JLPA.

COUNTS 2-5, LYING TO THE IRS

Nicholson faces four counts of making a false statement on a tax return. That’s one count for each of the four years (2012 – 2015) he perjured himself by knowingly submitting false work expenses and income on joint returns he apparently filed for a Forrest General Hospital employee who was not identified in court documents. All of the following are violations of Title 26, Section 7206(1) of the United States Code:

1. Count 2 alleges that Nicholson filed a 2012 Form 1040 joint income tax return that claimed other expenses of $16,664 on Schedule C for the principal business of Forrest General, Part V, and total income of $417,476 on line 22.

2. Count 3 involves the same charge for a 2013 Form 1040 joint income tax return. This one claimed $10,332 in other expenses on Schedule C for the principal business of Forrest General, Part V; total expenses of $16,664 on line 20 of Schedule E; and total income of $458,651.

3. Count 4 deals with knowingly false statements filed on a 2014 Form 1040 joint income tax return. Nicholson claimed other expenses of $19,164 on Schedule C for the principal business of Forrest General, Part V; total expenses of $8,332 on line 20 of Schedule E; and total income of $520,588.

4. Count 5 alleges perjury on a 2015 Form 1040 joint income tax return for which Nicholson claimed $25,000 in other expenses on Schedule C for the principal business of Forrest General, Part V, and total income of $1,854,958 on line 22.

COUNTS 6 – 11, WILFULLY HELPING PREPARE FALSE TAX RETURNS

Federal prosecutors allege the following violations of Section 7206(2), Title 26 of the
United States Code:

1. Count 6 alleges that Nicholson willfully assisted and advised in preparing and presenting an untrue joint Form 1040 U.S. Individual Income Tax Return for J.L. and G.L. for the 2012 tax year, knowingly listing a false income of $1,770,128 on line 22.

2. Count 7 alleges Nicholson committed the same violation for the 2013 tax
year, this time knowingly listed a false total income of $1,990,492 on line 22.

3. Count 8 deals with the 2014 joint Form 1040 Individual Income Tax Return Nicholson prepared for J.L. and G.L, which prosecutors say knowingly listed a false total income of $1,085,540 on line 22.

4. Count 9 addresses federal charges that Nicholson willfully assisted and advised in preparing a false Form 1120 U.S. Corporation Income Tax Return for JLPA for calendar year 2012 by knowingly reporting untrue total deductions of $3,185,253 on line 27.

5. Count 10 alleges a repeat of Count 9 for tax year 2013, with Nicholson helping prepare a false Form 1120 U.S. Corporation Income Tax Return for JLPA by knowingly reporting untrue total deductions of $$2,081,812 on line 27.

6. Count 11 alleges that Nicholson helped prepare a false Form 1120 U.S. Corporation Income Tax Return for JLPA for 2014, knowingly reporting untrue total deductions of $2,037,622 on line 27.

CONNECTING A FEW DOTS…

Nicholson for many years was recognized as a founding partner of Nicholson & Company CPA, a Hattiesburg-based accounting firm. The firm changed its name to Topp, McWhorter, Harvey a few years ago when Nicholson left the company following his 2015 arrest in Lamar County for public drunk, public profanity and disorderly conduct.
He is a former auditor for the City of Hattiesburg and Forrest County, and at one time served as president of the board of directors of the USM Foundation. Nicholson also served as president of the Board of Trustees of the Mississippi State Institutions of Higher Learning.

He prepared tax returns for Forrest County Deputy Sheriff Charles Bolton and his wife, Linda Bolton, both now in prison for tax fraud. The Boltons filed suit against Nicholson, alleging that he misled them and that they followed his advice in filing their tax returns. They were accused of failing to declare as income checks from local attorney John Lee they had cashed in a five-year period; federal prosecutors alleged that they described the more than $300,000 they received from Lee as loans in their tax filings.

The indictment against Nicholson refers to an attorney identified only as J.L. However, last February John Lee’s guilty plea for evading almost $300,000 in taxes for calendar years 2012 – 2014 was unsealed.

Canton Mississippi Pharmacist, Silas Richmond, sentenced in Cream Scheme fraud.

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Canton Mississippi Pharmacist, Silas Richmond, sentenced in Cream Scheme fraud.

Silas K Richmond a Canton, Mississippi pharmacist was sentenced today to sixteen months in prison and three years of probation for costing TRICARE over $350,000 in fraudulent billing that netted him just $21,000 in commissions. Richmond recruited a sole marketer in the scheme as was not a major player according to prosecutors.  The sentence carried up to 30 months, but Judge Starrett gave Richmond a break for his cooperation and for taking responsibility for his mistakes. Richmond must also repay over $350,000 in restitution at a minimum of $250.00 per month and be subject to having any federal benefits withheld and applied to the restitution amount.

Prosecutors praised Richmond for reaching out to them early on and helping them to “unwind” the fraud. Prosecutors even argued against some of the sentencing enhancements presented by the Department of Probation in Richmond’s Pre-Sentencing Investigative Report. Judge Starrett told Richmond that he felt like he (Richmond) was a “stand up guy” who just got caught up in a much bigger scheme, but who came clean early.  Judge Starrett also praised Richmond for not giving up in the face of his mistakes, and for staying employed and doing very hard work with his tree service. Starrett also told Richmond that he was sorry to see Richmond in this situation, and he was sure Richmond was sorry as well.

Silas Richmond worked for Marco Moran, a pharmacist in Canton and CEO of Dewmar International. Moran pleaded guilty to over $12 million in healthcare fraud, and is scheduled to be sentenced in March.  Interestingly, Moran funneled over $5 million of the fraud proceeds from his partnership with the Thomleys at Medworx, LLC through a wholly owned subsidiary of Dewmar. This naturally led to a spike in stock price. Marco Moran is scheduled to be sentenced in March.

Watch the courthouse live coverage here.

Monkey business? Judge Starrett shoots down Cream Scheme Survey Monkey; denies change of venue.

Hattiesburg Patriot
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Monkey business? Judge Starrett shoots down Cream Scheme Survey Monkey; denies change of venue.

United States District Judge Keith Starrett shot down the cream scheme Survey Monkey defendants Hope and Randy Thomley and Glenn Doyle Beach used to serve as the foundation of their motion for a change of venue due to, “extensive and extremely inflammatory pretrial publicity” which would prevent the Thomleys and Beach from receiving a fair trial.

The motion referred to regular and repeated “inflammatory pretrial publicity” that has occurred since January 2016 as well as media coverage of the indictments and guilty pleas of two alleged co-conspirators. Exhibits included news articles and media posts about the FBI raids in 2016 that launched the current prosecutions, the Albert Diaz trial, the indictments of Beach and the Thomleys, and the indictments and guilty pleas of alleged co-conspirators.

The motion relies heavily on results of a Survey Monkey questionnaire on pretrial publicity conducted by Dancel Multimedia, a D’Iberville-based company the defendants hired to help present their case. Dancel was formed almost 25 years ago; has offices in D’Iberville, New Orleans and Jackson; and lists a number of well-known clients and references on its website.

In his order, the Honorable Keith Starrett shot down the defendants monkey business and called calling the survey,

“virtually useless,”

and here’s why:

• The survey sample size was too small. Dancel surveyed only 259 people from three of the court’s four divisions. The Southern District’s total population is 1,853,619, according to the 2010 census; the total population of the three divisions from which the survey sample was drawn is 1,697,592.

Translated, that means Dancel surveyed just 0.014% of the population of the Southern District. That figure increases to 0.015% if you consider the population of the three divisions that Dancel sampled. Breaking the figures down, Dancel surveyed 0.019% of the population of the Eastern Division, 0.021% of the Southern Division and 0.011% of the population of the Northern Division. Nobody from the Western Division was surveyed.

• Even more troubling than the sample size, the Court said, was that Dancel did not explain how the sample was selected. Normally, studies provide information on how participants are selected, along with demographic data, to show that the sample of respondents is representative. Beyond that, Starrett asks, “Were the respondents eligible for jury service? What were the respondents’ news consumption habits, and did they vary from the rest of the population?”

The dearth of information left the Court with no way to determine whether Dancel used a representative sample, and no choice but to deem the data Dancel collected “from an already meager sample size” meaningless.

Judge Starrett’s order states that most events leading to the upcoming trial occurred in Forrest and Lamar counties, which account for 37.3% of the total population of the Eastern Division of the Southern District.

“…(T)hese matters have been highly publicized in print, online, and television media…(b)ut widespread publicity is not necessarily prejudicial,” he says, citing Skilling v. United States. He describes news articles attached to the defendants’ motion as “relatively benign…factual reporting” that does not warrant a change of venue, citing Murphy v. Florida, and material from social media and a local blog as “undeniably inflammatory and slanted in favor of the government.”

The constant and ongoing media coverage of all types has not been inflammatory or pervasive enough to make it impossible to seat an impartial jury from the Eastern Division of the Southern District alone, the judge says, but it would be challenging.

“Fortunately, there are numerous methods the Court can and will employ to ensure that an impartial jury is impaneled.” Judge Starrett states. His order outlines the following measures:

• The jury pool will be expanded to include the entire Southern District of Mississippi.
Judge Starrett notes that the defendants have said they could receive a fair trial in the Northern Division, which has a population (863,633) larger than the Southern and Eastern Divisions combined (833,959), and that the defendants omitted the Western Division. A jury pool that has been expanded to include the entire District, then, ensures that an impartial jury can be seated, he says.

This is an option that the defendants “conspicuously failed to address,” even after the federal government raised it, Judge Starrett comments.

• The Court will use the same methods it uses in every case to ensure that it seats an impartial jury.

1. It will follow its typical routine for conducting voir dire (the preliminary examination, or
questioning, of potential jurors).

The Court will examine the venire (the panel of prospective jurors) first, and will do so
collectively and, when necessary and appropriate, individually. Parties are free to request that the Court ask questions. When necessary, the Court will question individuals at sidebar to prevent tainting the entire venire.

Then the parties’ attorneys will be permitted to examine the venire, both collectively and, when necessary and appropriate, individually. Judge Starrett gives attorneys substantial room to conduct their own voir dire, but requires they stay focused on gathering relevant information.

The Court will not conduct or allow individual voir dire of every potential juror as a matter of course. The Court will not allow pretrial questionnaires. The parties will receive basic information regarding the potential jurors – name, sex, occupation, race, county of residence – on the morning of jury selection.

2. The Court also plans to increase the pool of potential jurors by summoning a larger-than-normal venire. At least three alternates will be seated because of the anticipated length of the trial and because the trial will be held during flu season. Because there are more alternates, defendants will receive more peremptory strikes to use as they deem necessary.

Even if the Thomleys and Beach were able to present enough evidence to demonstrate a presumption of prejudice because of inflammatory pretrial publicity, the district-wide jury pool and the other measures the Court plans will rebut that presumption, Judge Starrett concludes.

It’s bound to be a bitter pill for the three Cream Scheme defendants. Essentially, the decision means the Thomleys and Beach – who live and work in the Pine Belt – will be tried on January 8th here in federal court here in Hattiesburg.

The three face federal charges of making, marketing, prescribing and billing for fraudulent compounded medications and for conspiring to defraud health care insurance companies of millions of dollars with the illegal medications. The trio is accused of conspiring to pay and receive kickbacks and bribes to doctors and beneficiaries to promote “the Cream Scheme,” as this outlet has dubbed it, and of conspiring to launder the money they gained illegally. Alleged co-conspirators, Gregory Grafton Parker and Marco Moran have already pleaded guilty to conspiracy to commit health care fraud. It is expected both will testify at the forthcoming trial in January.

 

Appeal denied. Bolton’s sentencing enhancement related to jail food theft stands.

Hattiesburg Patriot
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Appeal denied. Bolton’s sentencing enhancement related to jail food theft stands.

With its decision earlier this month to uphold the convictions and sentences of former Forrest County Chief Deputy Charles Bolton and his wife, Linda, the Fifth Circuit Court of Appeals has insisted that the two defendants finally pay for the food Charles Bolton stole for years from the Forrest County Detention Center.

The Fifth Circuit Court of Appeals has upheld the sentence passed down by Federal Judge Keith Starrett, affirming that Charles and Linda Bolton are both responsible for restitution of unpaid taxes totaling $145,849.78, $28,500 of which was attributed to unpaid income tax on stolen food from the Billy McGee Law enforcement complex. The restitution also includes taxes owed on income the Boltons received from customers of their catering company, which was reported as loans on their taxes, and from unreported cashed checks written by local attorney John Lee to the Bolton’s businesses. Lee has pled guilty to filing false tax returns and has been disbarred from practicing law.

According to a filing by Bolton’s former Attorney, Joe Sam Owen, in response to Bolton’s claim on appeal that he received ineffective assistance of council (by Owen), Owen listed four conflicting accounts of what Bolton said he did with over $250,000 in money from the cashed written by Lee to the Bolton’s business.

A major source of contention with Charles Bolton’s sentence was the twelve month enhancement he received related to the stolen food (and unpaid taxes on that food). During his sentencing, Judge Starrett strongly admonished Bolton about the culture of corruption at the Billy McGee Detention center under Bolton’s tenure. Starrett told Bolton at the sentencing,

“What really upsets me is I believe what they say — there is a culture of corruption at the jail,”

Federal Sentencing Guidelines for his tax crime range from 27-33 months, but the district court handed down a 45-month prison term.  The upward variance, as it’s called, is based on a complex legal principle known as “relevant conduct.”

Relevant conduct refers to actions of the defendant – carried out as an individual or with others – that are related to the case at hand and that the courts can consider during the sentencing phase.  These actions are performed in preparation for the crime, while it occurs, and afterwards, to avoid detection, according to a Primer on Relevant Conduct produced by the U.S. Sentencing Commission last spring.

The 5th Circuit agreed with the lower court that the 12 month enhancement for Bolton’s relevant conduct connected to jail food theft at the Billy McGee Detention Center was appropriate.

A LITTLE HISTORY

The Boltons were indicted initially on five counts of attempted tax evasion and five counts of filing false tax returns.  At trial in September 2016, Charles Bolton was convicted on four counts of attempted tax evasion and five counts of filing false tax returns.  Both Boltons were acquitted on one of the charges of attempted tax evasion. The jury did not convict Linda Bolton on the remaining four attempted tax evasion charges but did convict her on all five counts of filing false tax returns.

The tax fraud case arose out of a 2014 investigation into whether Bolton, chief deputy since 1992, and others were stealing food from the Forrest County Juvenile and Adult Detention Center, which Bolton oversaw.  The food theft investigation, conducted by the Federal Bureau of Investigation and the Mississippi State Auditor’s Office, did not lead to charges against the Boltons; however two kitchen workers under Bolton pleaded guilty in December of 2014. One of those individuals was the kitchen manager, Alan Haralson. Haralson died a few months later from health complications.

Charles Bolton was sentenced to 45 months in prison with three years of supervised release and a $10,000 fine and Linda Bolton was sentenced to 30 months in prison with one year of supervised release and a $6,000 fine.  Both were given responsibility for restitution of $145,849.78.

THE BOLTONS’ APPEAL

The Boltons appealed, disputing numerous elements of the trial, including the district court’s authority to impose restitution, the way the loss amount was calculated, the length of their respective sentences, and much more.  Chief Judge Carl E. Stewart, with Circuit Judges Wiener and Higginson, addressed each of the numerous arguments raised by the Boltons and found all but one without merit. The decision for the Court of Appeals for the Fifth Circuit was filed October 18, 2018.

The original sentence directed that restitution payments of $1,000 monthly begin immediately, while the Boltons are in prison; Charles Bolton argued that the U.S. District Court does not have the authority to impose restitution. The Fifth Circuit Court of Appeals disagreed, ruling that the court does have the authority to impose restitution, but not to schedule payments that coincide with prison time. For that reason, the district court’s restitution order was modified so that payments begin when the Boltons begin their terms of supervised release.

The Boltons argued also that the loss amount was not determined properly.  The Court of Appeals disagreed, stating that the loss calculation by the district court is a factual finding to be reviewed for clear error, with deference for the sentencing judge’s assessment and the goal of determining whether the district court estimated the loss reasonably.

“ʻUnder the Sentencing Guidelines, the base offense level for a tax fraud offense derives from the amount of loss that is the object of the offense,ʼ”

the Court of Appeals decision stated.

“ʻIf the tax loss is uncertain, the district court is permitted to ʻmake a reasonable estimate based on the available facts.ʼ”

“Here, the district court’s total loss amount of $145,849.78 … was based on the tax owed as a result of the charged offenses ($117,369.84) and the estimated amount of tax that the Boltons failed to pay ($28,479.94) on the food stolen from the FCSO Detention Center that was used at their businesses. Testimony was presented at trial that the Boltons received … approximately $273,000 worth of checks from [Attorney John] Lee as income. Charles incorrectly argues that using the tax loss amounts from the Lee checks was error….”

The Court of Appeals said that statements made by Charles Bolton,

“do nothing to undermine the information in the PSR or show that it ‘was inaccurate or materially untrue.’”

It also affirmed the district court’s decision to include taxes owed on the income from Count 1, even though Charles Bolton was not convicted of attempted tax evasion.

“…[T]he district court’s inclusion of the loss amount from Count 1 was proper. Charles’s acquittal on Count 1 did not prevent the district court from considering the conduct underlying the acquitted charge as long as it was proven by a preponderance of the evidence, which it was in this case.”

The court ruled that the evidence presented at trial was sufficient to prove that the Boltons committed tax fraud in 2009 and were convicted of filing false returns that year. Also, the Court of Appeals commented that the district court determined the restitution amount with the same figures it used to calculate the damages amount, concluding that Charles Bolton failed to show an abuse of discretion.

In addition to objecting to the amount of restitution, Charles and Linda Bolton each disputed the length of their respective sentences.

The Court of Appeals decision explains that the district court is authorized to impose a variance based on relevant conduct and that in this case, an extra 12 months was added for the unpaid taxes on the food Bolton stole from the Forrest County Sheriff’s Office Detention Center for use at his Sports 22 restaurant and catering business.  The food thefts were admitted in pre-sentencing reports and supported by witness statements, the court said; furthermore, there is a need to deter future criminal conduct.  The court also points out that the conduct was not established as untrue, inaccurate or unreliable.

“ʻ…[C]ontrary to Charles’s assertion, the record reveals that the district court explained that it was imposing the upward variance because, among other reasons, “[t]here was a culture of corruption in the Forrest County Jail, and [Charles] knew it and . . . allowed it to go on.” For these reasons, Charles has failed to show that the district court plainly erred in imposing his sentence….’”

Linda Bolton claimed that the length of her sentence was not appropriate for the level of her involvement and that the district court did not consider her age, the minimal odds that she would become a repeat offender, and other relevant factors. However, the court of appeals described her argument as “misplaced” and noted that her sentence falls within federal sentencing guidelines.

In appealing, the Boltons filed a number of other arguments, each considered by the court and found to be without merit.  They claimed:

  • The indictment was insufficient.
  • There was not enough evidence to support their convictions.
  • At least one Brady violation (suppression of material) occurred.
  • Their Confrontation Clause rights (guarantee of an opportunity to cross-examine) were violated.
  • The government engaged in prosecutorial misconduct during the trial.
  • Mistakes were made when jury instructions were given.
  • Mistakes were made when the Boltons were sentenced.
  • Charles Bolton was denied his choice of counsel or did not receive effective counsel.
  • The district court erred when it decided that Charles waived his attorney-client privilege.

Charles Bolton has been incarcerated in federal prison since May 3, 2017. His request for release pending appeal was denied by the district court.

Officer attempted to disarm AG Commissioner Andy Gipson at August 2018 Jackson Fairground event

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Officer attempted to disarm AG Commissioner Andy Gipson at August 2018 Jackson Fairground event

Recently appointed Mississippi Agricultural Commissioner Andy Gipson informed the pubic via Facebook that a security officer at an event at the Jackson Fairgrounds attempted to search and disarm him while attending an event there; that is until the officer was informed as to who Gipson was. The Mississippi Agriculture Department’s Director is over the fairgrounds and its policy.

Gipson a staunch 2nd Amendment advocate, who replaced Cindy Hyde Smith when she was appointed to the Senate seat in March of 2018, said in August 22nd Facebook post,

“a few days ago at a public event on public, taxpayer owned property I was approached by an armed official who attempted not only to unlawfully search me, but also to confiscate my personal lawfully-owned and carry pistol. He attempted this while carrying his own pistol in plain view. Also this was an official whose salary is paid by Mississippi taxpayers.

As for his attempt to take my weapon, let’s just say he was unsuccessful.”

The previous agricultural Commissioner, Cindy Hyde Smith, who was appointed by Governor Bryant in March of this year to the United States Senate, is currently running for the Senate seat against state Senator Chris McDaniel and Mike Espy.

In 2013, after the enhanced carry laws were in effect, Hyde-Smith requested guidance from the Mississippi Attorney General’s office  regarding her ability to prohibit, “weapons , concealed of not concealed” at the Fairgrounds complex and other departments under the purview of the Agriculture Department. Hyde asked Mississippi Attorney General Jim Hood in Opinion 2013-00215,

In light of recent amendments to Miss. Code Ann. Section 97-37-1 (House Bill 2, 2013 Regular Session), can the MFC and the Department prohibit the carrying of weapons, concealed or not concealed, on the Mississippi State Fairgrounds Complex and at properties of the Department, including but not limited to the Mississippi Farmers’ Market and the Mississippi Agriculture & Forestry Museum, by posting signage prohibiting the carrying of a weapon?

The answer from the Mississippi Attorney General directed Hyde-Smith to 45-9-101(13) and stated with regard to concealed carry (not enhanced concealed carry),

In addition to the places enumerated in this subsection, the carrying of a stun gun, concealed pistol or revolver may be disallowed in any place in the discretion of the person or entity exercising control over the physical location of such place by the placing of a written notice clearly readable at a distance of not less than ten (10) feet that the “carrying of a pistol or revolver is prohibited

It is the opinion of this office that MFC and the Department can disallow the carry of concealed weapons by concealed permit holders by following the notice provisions of Section 45-9-101(13). Thus, with regard to regular concealed carry permit holders, a public body can prohibit the concealed carrying of weapons in all locations by posting the signage referenced in Section 45-9-101

Just before the October, 2017 Mississippi State Fair, Hinds County Sheriff Victor Mason informed the public that a policy prohibiting the carry any firearm into the Mississippi State Fair would be in effect. WAPT covered the 2017 Mississippi State Fair gun policy directive by the sheriff and reported,

“Mason said law enforcement officers are the only ones who should be carrying weapons at the fair.
‘If we find that you are carrying a weapon, you will be escorted out,’ Mason said.”

That policy, on the part of the Mississippi Department of Agriculture and the Hinds County Sheriffs Department in 2017, was not in accordance with Mississippi State Law as it pertains to the privileges of Mississippi Enhanced Carry permit holders.

Hattiesburg Patriot News Media contacted MDA Director Andy Gipson for comments and clarity related to his August 22nd Facebook Post. Gibson explained that there was a private non profit group at a “gun related event” that contracted for security with the Hinds County Sheriffs Office and a reserve deputy approached him and asked to search him. Gibson asked why?

According to Gipson the deputy said,

“We don’t allow any guns in here.”

Gibson went on to explain,

“Somebody said ‘THIS IS THE COMMISSIONER!’ And he said ‘Oh, well that makes all the DIFFERENCE in the world.’ And I said (out loud), ‘It shouldn’t make any difference, cause if anybody has a right to have it, leave em alone.”

Gipson said,

“I want to let folks know the fight for freedom is never over. It’s Never over. You just can’t let your guard down.”

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