United Bank VP we sued to plead guilty in federal court

The State Journal ran a story today entitled “Guilty Pleas Expected in Development Scam” announcing that a former United Bank Vice President and loan officer who we sued as a part of our Walnut Springs Mountain Reserve civil fraud case, “R. Leon Cooper” has agreed to plead guilty to federal crimes as part of a plea deal.

The conduct supporting the plea has to do with fraud which occurred in the development of the “Lamplighter” subdivision in Lewisburg, WV.  The story also noted that:

As part of the guilty pleas, both Carter and Cooper agreed to cooperate with the U.S. Attorney’s office on further investigations. Both Carter and Cooper also will forfeit nearly $2 million in valued property.

Carter is scheduled to enter his guilty plea Jan. 6 in Beckley. Cooper’s plea has been scheduled for Jan. 13 in Beckley.

Cooper was the former Fayette Planning Commission president involved in the failed River Ridge development in Fayetteville.

That development crumbled when sewer plans for the development were prematurely approved so loans Cooper facilitated through United Bank could be approved for property purchasers, according to lawsuits filed concerning that development.

Cooper also has been named in a civil lawsuit filed in the failed Walnut Springs development in Monroe County.

The Monroe County lawsuit is pending.

There also was a story in the Charleston Gazette yesterday that United Bank paid $15,000,000.00 in fraud settlements in 2009 alone.  And we wonder why the economy collapsed….  The Gazette also ran a story on Friday on the Cooper fraud.  The banks have been running absolutely wild.  We are still sorting out how many innocent U.S. citizens were harmed due to bank fraud in the mid to late 2000′s.  It is a big deal for these two West Virginia publications to start reporting on United Bank’s dirty laundry.  For those of you who don’t know, United Bank basically runs the state of West Virginia.  It is the “state’s largest bank” and many, many people and institutions in West Virginia are afraid of it.  But once the cat’s out of the bag, it’s out.  I suspect we will read more soon.

Ok, here’s more:  A Virginia businessman, Osama M. El-Atari, 31, pled guilty to bank fraud totaling $53,000,000 in fraudulent loans.  Guess who else was involved?  That’s right, United Bank.  A United Bank Vice President and loan officer (same general position as Cooper), Sissaye Gezachew, 32, was arrested and pled guilty to bank fraud for his involvement with El-Atari. See Washington Post article and FBI press release.  Banks do not exactly advertise these incidents, or even explain them, to their customers or shareholders.  In fact, they don’t even let their mortgagees who have been victims of fraud know about the fraud.  Rather, they pretend it never happened and demand their money.  Then they foreclose and threaten to garnish wages.  Of course you would still be safer with United Bank than dealing with United Bank of Africa.

When the judge starts prosecuting you, you know you have a problem….

There is a story in the Charleston Daily Mail today titled, “Judge refuses to accept guilty plea from ex-firefighter.”  Apparently the defendant was charged with second degree arson for the destruction of a boat dock.  According to the assistant prosecutor, it may have been an accident – albeit a reckless one.  But recklessness or negligence, doesn’t qualify as “willful or malicious” if there was no intent to set a fire or burn an object – thus giving the prosecutor good reason to plead the case to a destruction of property – a misdemeanor.

But apparently the judge wasn’t having it, and refused to accept the plea.  Something that I have noticed in arson cases: the judges’ take them very seriously. When buildings or objects are getting burned in their districts, people pay attention and so do the judges.  The judge doesn’t want to be the one who let the defendant out on probation only to have something else burn down.

And being that there is no misdemeanor arson charge, the only lesser-included available is destruction of property – which carries a maximum of one year in jail. Oftentimes, an arson defendant already will have served a considerable amount of time in jail because the bond was most likely set extremely high – or else they have been on home incarceration.  The result is that the person will not do much time – and hence, the judge doesn’t want to accept the plea.

But can the judge do that?  Yes, if he finds there is no factual basis for the plea.  But, is there anything stopping the prosecutor from dismissing the charge and recharging destruction of property?  Probably not – unless the judge is going to try the case, which of course he can’t do.  In any event, the case would have to be dismissed eventually due to lack of speedy trial.

 - John H. Bryan, West Virginia Attorney.

So far away, yet so similar…

While perusing Fort Worth criminal defense attorney Shawn Matlock’s blog, I came across a post describing the world of Texas’ Magistrate Court, which seems to be strikingly similar to West Virginia’s Magistrate Court. Apparently we are not that unique with respect to the concept of speed-pleading. And I thought that I was the only one who felt uncomfortable in that type of judicial atmosphere…

– John H. Bryan, West Virginia Attorney.

This Blog Makes Front-Page News…

Note: this post was initially much more extensive.  Pursuant to the advice of my beautiful wife, against whom I have never won an argument (and suspect I never will), and who’s advice has the usual effect of making my hot-heated initial reactions seem childish and ineffective, I have revised this post.

It seems that my humble commentary regarding the Register-Herald op-ed piece detailed in my last post touched quite a few nerves at the Monroe Watchman newspaper. For those of you who may not know, the Monroe Watchman is the main newspaper for Monroe County, West Virginia, and it has been continually published since 1872. It’s a great paper. I read it every week, and I am also a paying advertiser. They are also located right across the street from my office building.

Why should they care about my commentary in this post? Because the Watchman is owned by the family of the former prosecutor who I allegedly criticized, and understandably, they are protective of their family members. And also understandably, the former prosecutor is deeply hurt as a result of the lost election.  And I completely understand the hurt, as I suffered through my father’s election defeat as a college student.  It’s not easy to see negative television commercials about your father running during prime-time every couple of minutes for a month straight.  Your natural reaction is to lash-out at your perceived threat, and I guess that that is what I was doing as well in my initial response in this post.  And so I also understand why the former prosecutor feels the need to protect himself and his family.

This situation is not about me, it’s not about the former prosecutor, nor the current prosecutor, nor the magistrate – nor the Watchman.  This is about Mr. Watson, who made the intentional choice to consume alcohol and drive a dozen children off of a 120 foot cliff in a Monroe County school bus.  This is about Mr. Watson, who tried to save his own skin by lying and claiming that he consumed Nyquil the night before.  This is about Mr. Watson, who misled much of the community into believing that he was innocent, only to let them down with the sad truth – that he had an alcohol problem.  But, he still didn’t want to lose his job, and he didn’t want to lose his retirement.  That was what Mr. Watson was worried about.  Was he worried about the children on board his reckless DUI school bus?  No, he was worried about himself.  This is about the fact that Mr. Watson received a plea deal where only two days was recommended, and where he only received twelve (to serve on the weekends at his leisure).  

When I was working as a young prosecutor in Raleigh North Carolina, I tried a man for 2nd offense DUI.  He was convicted and sent to jail for one year.  There was no accident, no children in the car, no adults in the car – nobody injured whatsoever.  He was just some guy who got pulled over and failed some field sobriety tests.  That was a serious charge.  He was the first person I sent to jail as a prosecutor.  I’ll never forget the image of a deputy walking up behind the man and putting him into handcuffs.  Imagine if this man, when he was pulled over, had a child in the car?  Imagine if he had a dozen children in the car.  Imagine if he had a dozen children in the car and drove off a 120 foot cliff.  Imagine that he did this with your child in the car, entrusted to his care, and that afterwards he lied and told you that it must have been the Nyquil he took the night before?  My point is, this is about protecting the children.  We should have made an example of this man.  He was a school bus driver for heavens sake!  The citizens of Monroe County trusted him to drive their children to school and back every day!

I have been on the other side of the coin as well.  As a defense attorney in Greenbrier County several years ago, I had a client who was convicted of 2nd offense DUI.  We begged and pleaded to the judge for a light sentence, since he wanted to join the military.  The guy was sentenced to one year in jail – and he actually went to jail for about 8 months before he got out of jail.  He wore the orange jumpsuit and ate the awful food for breakfast, lunch and dinner – everyday.  He did his time.  He didn’t whine or complain.  He served his debt to society. 

My argument is simply this: did this man not deserve a real punishment?  Would it really have been a great miscarriage of justice if this man had really been forced to serve a real sentence in jail?  I don’t think so.  It happens all the time in 2nd or 3rd offense DUI cases.  Is it not more egregious for a man to get drunk and then drive a school bus loaded with children?  And then to actually crash off a cliff?

Since the Editor criticized me for making “no effort to discuss the issue with Mohler before writing [my] scathing assessment…” then I will reiterate the same offer that always exists on this blog – both to subjects of my posts and to casual observers: if you disagree with something I have said, then please, by all means, leave a comment on the blog. As always, anonymity will be maintained where requested.

- John H. Bryan, West Virginia Attorney

Opinion Piece in Register-Herald Regarding Monroe County School Bus DUI

As some of my readers will remember, I was given some flack in the community for speaking out early against this bus driver – Clyde Watson. And as it turns out, Mr. Watson proved himself to be a disgrace after all. The really mind-numbing part of this is, that people in Monroe County love this guy for some reason. It seems he is the “everybody’s favorite uncle” type. The editorial slams Monroe County for the way in which this case was handled.

The editorial places some blame on the prosecutor, and I must now stick up for him with respect to the most-generous plea deal. The previous prosecutor made the plea agreement. No matter how ludicrous the agreement was, it was the current prosecutor’s duty to follow-through with that agreement. It is no different than if he made the agreement himself. So, it was not his fault that the plea agreement was executed.

The paper gave a lot of flack to the magistrate, who gave the guy a 12 day sentence, to be served on the weekends at his leisure. To her credit, she actually increased the sentence from what the previous prosecutor had agreed to recommend – which was 2 days. However, it seems that the guy just walked in and asked to be sentenced quietly – without a lawyer, and without the prosecutor (or any victims) present. The paper did note that the magistrate made a phone call to the prosecutor to make sure that the sentence was okay with him.  Actually, this is pretty much what always happens in misdemeanor cases in magistrate court.

Welcome to the world of magistrate court. The prosecutor is king. The prosecutor wants X, he gets it. The prosecutor wants Y, he gets it. Trust me, I am still waiting on a phone call from a magistrate requesting my blessing for someone’s sentencing. And this is the way things happen. If you are charged with a felony, there is a boatload of paperwork and formal procedure (and legal mumbo-jumbo). But, if you are charged with a misdemeanor, then you are in magistrate court, and things appear, disappear, reappear, and are modified, with not much more than the stroke of a pen or a phone call.  That’s just the way it works.

Observing from the ivory tower is one thing, but in reality, what could have been done differenlty by this prosecutor and this magistrate? About the only thing the prosecutor could have done differently is make sure that the victims were given the opportunity to speak at the sentencing. But then again, that is almost never done in misdemeanor cases.  He could not have recommended or argued for anything more than 2 days.

The magistrate could have reviewed the presentence investigation report (“psir”) prior to the sentencing, and could have scheduled the hearing for a date when the victims and their families could have been there to speak. But in reality, if a psir was prepared, the guy was most likely petitioning for probation, in which case the sentencing should have been in circuit court, where psir’s are regularly prepared and reviewed. Furthermore, this also almost never actually happens in these misdemeanor cases.  Even with felonies in circuit court, this is mostly a formality. The biggest thing of substance that she could have done is to give the guy a larger sentence. How about some real jail time? How about a year in jail? 6 months? How about 30 days of real, actual, jail time? He would have deserved it. But it would have been extremely unusual for a magistrate to stray that far from the recommendations of the prosecutor.  In fact, she already exceeded the prosecutor’s recommendation fourfold….

So if justice was not served in this situation, the Register-Herald can point their finger at the former prosecutor.  But there is no sense in doing that, because he already lost his job, and that probably was partially due to this case.  And nothing positive is served by rubbing salt in his wounds.

Despite the “slap on the wrist,”  Mr. Watson suffered a punishment that is rarely given in misdemeanor offenses: major coverage and castigation in a prominent regional newspaper.  Henceforth, any time someone googles his name, these articles will come up.  It will be difficult for him to ever get past this time in his life…  I don’t know about you, but I would rather do a stint in jail than have your darkest hours broadcasted to the surrounding 5 counties, to live in perpetual existence on the internet.

You can read the full editorial here.

- John H. Bryan, West Virginia Attorney.

Greenbrier County “Cattlegate” Sentencing This Month

I have been asked many times recently what has happened with this case. Well, nothing has really happened since the sentencing has not yet taken place. The sentencing for these crooks will take place on June 30, 2008 before U.S. District Judge Thomas E. Johnston. There are also several civil cases currently pending in this matter, which undoubtedly will be detailed in the future.

You can read my previous post here.

– John H. Bryan, West Virginia Attorney.

Two Charleston Cops Get Plea Deal For Spotlighting Deer

As I detailed in a previous post, which can be found here, two Charleston cops, who were off-duty, were caught spotlighting and shooting a deer on W.Va. 34 near Liberty. Did they admit to their crime, apologize and beg the public for forgiveness? No, or course not, the law only applies to citizens, not cops, right? They claim they were ending the suffering of a poor injured deer. Even if that were true, and even if cops are allowed to do this, would it be proper to do it at night with a spotlight? In West Virginia, there are farmhouses all over the place. How could you be sure you wouldn’t kill some innocent person?

These cops are obviously lying, and nobody seems to care. Okay, assuming they shot this deer as part of their official duty, did they radio the dispatcher as to what they were doing? Were they even in their jurisdiction? Everyone knows thats a bunch of garbage. They committed an illegal act, then they got preferential treatment. The DNR officer even stated that “it was difficult to investigate two law enforcement officers….” Why in the world would it be difficult. If I was a cop and I became aware of two crooked cops using their badge and gun to break the law, I would get great enjoyment out of busting them and taking them to task. Heck, they are slandering your profession with their reckless disregard for the law and their utter hypocrisy.

So these cops got a plea deal. They were allowed to plead no contest and were given fines. Apparently the conspiracy charges were dropped as well. The Charleston Police Chief is apparently struggling with what, if any, discipline these officers should suffer with respect to their jobs. Hello…. what about the fact that these cops are lying through their teeth while pleading no contest at the same time? How many poor saps have been convicted based on the testimony of these two cops? I say, let’s reopen all of those cases, because these two guys are liars. Despite this, nobody wants to face the fact that cops lie on the stand, under oath, every single day. Why? Who knows and who cares. They have a variety of reasons, not limited to covering up their own wrongdoings.

The fact is though, that these two cops are lying and it is obvious. The cover-up is worse than the original crime. So they spotlighted deer… in the grand scheme of things it is no big deal. Nobody is perfect, we have all done things that are illegal at one point in our lives. They should have apologized and asked for forgiveness.

These two are hypocrites and liars, period.

You can read the entire article here.

– John H. Bryan, West Virginia Attorney.

Bluefield Man Pleads to Voluntary Manslaughter – Not a Bad Deal

From the Bluefield Daily Telegraph:

A Bluefield man facing first-degree murder in the 2007 shooting death of a another Bluefield resident entered into a plea agreement Tuesday in Mercer County Circuit Court.

Ronald Jerome Finney, Sr., also known as R.J., 53, pleaded guilty before Judge Derek Swope to a felony charge of voluntary manslaughter. Finney was indicted in February on first-degree murder in the Oct. 31, 2007 shooting of Donald Lamont Greene, 32, of Bluefield. Greene died as the result of a gunshot wound to the chest.

Finney was apparently claiming that he fired in self defense, stating that he was in fear for his life. However, the situation stemmed from him attempting to purchase crack-cocaine – not exactly a “clean hands” position to be in. Furthermore, his story was pretty shaky. Finney said in his statement that he waited outside [the drug dealer's house], and that Greene later came up to him, threatened him, and “he acted like he had something in his pocket, so I just shot him,” adding that he fired a second time when Greene “then tried to get something out.”

Finney must have been pretty believable though, because prosecutors gave him a pretty good deal – voluntary manslaughter – only carrying a determinate sentence of 3 to 10 years (compared with life for first degree murder, or up to 40 years for second degree murder). This was well-worth accepting in lieu of taking a chance with the jury and possibly facing life in prison.

You can read the full article here.

– John H. Bryan, West Virginia Attorney.

Mercer County Teacher Charged With Sexual Abuse- Illustrates Abuse of the Law

From the Charleston Daily Mail:

A Montcalm High School teacher accused of having a relationship with a student faces sexual abuse and abduction charges.

State Police First Sgt. Gary Tincher says 30-year-old Christi Lee Williams was arrested in late April.

Williams remains free on bond after being charged with sexual abuse by a parent, custodian and guardian and abduction of a student within 1,000 feet of a school.

Tincher says Williams is accused of having a relationship with a 16-year-old male student who allegedly left school property with her.

Tincher says the teacher has been suspended from her job.

What is the deal with young, attractive teachers across the country having these sexual relationships with young boys? I can’t remember hearing anything like this when I was in high school – other than in a Van Halen song.

Let’s look at the charges: First, abduction of a student within 1,000 feet of a school. Okay, that charge is garbage. The kid was 16 – old enough to drive, and actually 16 is the age of consent. The allegations are that he went willingly. Prosecutors and legislators can make up whatever law and charges they want, but the fact is that there was no abduction. This is just a garbage charge to help them get a plea.

Secondly, sexual abuse by a parent guardian or custodian. This is the most abused and misused charge on the books. The reason is this: in almost every situation, like it or not, the legal age of consent in West Virginia is 16 years old. That means that ignoring relationships, this 16 year old kid can have sexual relations with whomever he wants. However, if there is a relationship, then all of a sudden the other party goes to prison for 10 to 20 years. That’s right, that is the punishment for this charge (something that you are not allowed to tell the jury). So, if the prosecutor alleges the other party is a babysitter, teacher, whatever – even if the kid is 16 or 17 and has his own car and drives all over the place, it then becomes punishable by 10 to 20 years. This is an abuse of the law. The charge was meant to cover awful situations where parents or actual guardians abuse children under their care. The problem is that the statute was written much to broadly, thus allowing police and prosectors to abuse it. For instance, this woman is facing 10 to 20 on that charge. Under the statute, technically, she can be convicted on it. The jury never gets to know that she will get 10 to 20. They will assume she will get probation, or maybe 6 months or a year. She will get convicted on the charge, despite the unfairness of it. The end result is, that her lawyer will most likely advise her not to take the chance of going to trial, and to accept the plea offer of misdemeanor battery with a sexual motivation, or something like that, which will put her in jail for a year and make her a registered sex offender for life.

Read the full article here.

– John H. Bryan, West Virginia Attorney.

McDowell County Pharmacist Admits Crimes Tied To Gambling

From the Charleston Gazette today:

Yesterday Saad Kamil Deeb, a Welch Pharmacist, pled guilty to a 3 count information, charging him with enlisting others to help him conduct transactions at a McDowell County bank so that he could move large amounts of money without triggering a Currency Transaction Report. A financial institution is required to file such a report with the Internal Revenue Service for any transaction over $10,000.

Assistant U.S. Attorney Hunter Smith said that between 2001 and 2005, Deeb became heavily involved in gambling on sports, betting large sums of money and even placing bets on behalf of his friends.
Whether he won or lost, his gambling proceeds or debts were paid in cash, Smith said. Usually, the amounts would approach $100,000 before Deeb or his bookies paid up, he said. “Mr. Deeb did not want the IRS to know that he was engaged in large cash transactions,” Smith said. So he and the others would keep their transactions under the $10,000 ceiling, Smith said, sometimes transferring just under that amount to various accounts several days in a row. According to the information, Deeb and his associates moved more than $871,000 that way over a four-year period. Deeb also admitted skimming cash from the pharmacy and filing false tax returns in 2003 and 2004, failing to report roughly $300,000 in income for each year, resulting in a tax loss of $175,000. Deeb has since filed amended reports and caught up on the taxes he owes, Smith said.

Who knew that a small town pharmacy could make that much so as to skim $300,000 per year for a gambling habit (addiction)? It makes you wonder who is at fault for the high prices of prescription drugs… My grandfather was a small town pharmacist, and for part of my life I grew up in his pharmacy. Things must have changed a lot since then… or maybe that is just par for the course in McDowell County….

– John H. Bryan, West Virginia Attorney.

Monroe County School Bus Driver BAC was .093

From today’s Register-Herald:

Prosecutor: Bus driver’s alcohol level was higher than field test showed

– MONROE COUNTY

By Christian Giggenbach
Register-Herald Reporter

UNION — Medical tests have revealed the blood alcohol level of a Monroe County school bus driver charged with DUI following an accident in February was considerably higher than his preliminary on-scene breath test, a prosecutor said Tuesday.

Clyde Watson Jr., 62, of Union, appeared briefly before Monroe County Magistrate Nancy Crews for a pre-trial hearing and was represented by Gap Mills lawyer Geoffrey Wilcher.

State Police charged the 14-year veteran school bus driver with DUI with minors in a vehicle after he crashed his school bus down a 120-foot ravine with 11 children aboard on Feb. 5.

School officials said Watson over-corrected his steering after running off the right side of the road and then slammed through a telephone pole before plunging down the ravine and finally coming to rest over a small creek. No children were injured in the accident.

County Prosecutor Rod Mohler told Crews a “plea agreement has been offered” to Watson which allows the defendant to plead guilty “as charged.”

“Based on Mr. Watson’s years of community service, the state will not object and would be willing to agree to the minimum sentence and fine,” Mohler said. “I think Mr. Watson wants to take some additional time to think over what has been offered and the state will not object.”

Two days after the accident, Watson apologized for his actions in a letter to the school board and also tendered his resignation. In the letter, Watson said he had “hit rock bottom” the morning of the accident and had “an ongoing alcohol problem.”

Mohler’s case against Watson was strengthened greatly after the defendant’s blood test showed a .093 BAC level nearly two hours after the accident.

A preliminary breath test at the scene indicated a relatively low level of alcohol, about .022. Preliminary tests cannot be used as evidence in a trial. However, a blood test can be used as evidence and Watson’s new BAC is higher than the state’s .08 legal limit. After a person’s BAC level reaches .08, a driver is “presumed to be impaired” under West Virginia law. A state CDL regulation requires drivers to be under .04.

Watson did not speak and quickly exited through the back door of the magistrate’s office with family members after the five-minute hearing.

Mohler called the new BAC reading “substantial” and said it puts to rest other issues that previously were raised concerning the accident. At the time of his arrest, Watson told police he had taken the cold medicine Nyquil, which contains alcohol, the night before the accident. Mohler had previously indicated the defendant may also have been diabetic.

“This also takes any health issues out of the picture as the cause of the accident,” Mohler told The Register-Herald after the hearing.

Crews tentatively scheduled another hearing in 30 days. If convicted, Watson faces two days to 12 months in jail and up to a $1,000 fine.

— E-mail: cgiggenbach@register-herald.com

Federal Judge Rejects Plea at Hearing

From the Charleston Gazette:

Note: If the woman is telling the truth, then bravo for the judge to immediately halt the hearing, as there is no basis for the plea and the lady is being railroaded. However, there may be other evidence that she is not telling the truth. For instance, there may be a prior statement given by the defendant. It is doubtful that her attorney would advise her to take this plea if there was no other evidence other than the fact that she actually mailed the package. But, if there is not, then she should not accept the plea. Defendants should never be forced to accept a plea even though they are innocent, just because a conviction is possible. – John H. Bryan, West Virginia Criminal Defense Attorney.

Crime details lacking, so judge rejects plea

By Andrew Clevenger
Staff writer

A plea hearing in federal court came to an abrupt end on Thursday, after a Mingo County woman accused of laundering drug money said she had no idea what was in a package she allegedly mailed.

Chief U.S. District Judge Joseph R. Goodwin asked Lorene Canterbury of Dingess to explain exactly what she did to constitute the crime of money laundering.

“I mailed a package from Naugatuck, West Virginia,” she said. The package, which she sent to Chicago, contained two books she bought at Books-A-Million and a manila envelope, she said.

When Goodwin asked her what was in the envelope, Canterbury said she didn’t know.

“Honestly, I can’t say, but I’m taking responsibility for it,” she replied. “I thought it was a T-shirt.”

Goodwin immediately halted the proceeding.

“This plea hearing is over,” he said. “I reject the plea.”

The judge then stood up and walked out of the courtroom.

Canterbury was charged via an information, which generally indicates a defendant is cooperating with authorities. An information cannot be filed without a defendant’s permission.

According to the information, Canterbury allegedly mailed $54,000 in cash on Sept. 17, 2003, for the purpose of laundering the proceeds of powder cocaine sales.

After the hearing, Assistant U.S. Attorney Josh Hanks said the case was now back to square one, as if nothing had ever happened.

When plea deals are rejected by a judge, prosecutors can continue investigating cases and try to get an indictment from a grand jury, or lawyers for both sides can discuss another agreement, he said.

To contact staff writer Andrew Clevenger, use e-mail or call 348-1723.

Ex-PTO Mom Pleads Guilty to Embezzlement

From the Charleston Gazette:

Dawn Compton, who pleaded guilty to embezzling more than $10,000 from the West Teays Elementary parent-teacher organization, consults with her lawyer, David Moye, in Putnam Circuit Court on Thursday. ..

Ex-PTO mom pleads guilty to embezzling more than $10,000

By Alison Knezevich
Staff writer

WINFIELD – The former president of a Putnam County parent-teacher organization pleaded guilty Thursday to embezzling more than $10,000 from an account meant for playground equipment and a school carnival.

Dawn R. Compton, 42, admitted in Putnam Circuit Court that between August 2006 and July 2007, she had taken $10,338.07 from the West Teays Elementary School PTO to buy items for herself.

At her hearing, she wrote out a $3,000 check to the PTO. Her lawyer, David Moye, said he would mail the check to the PTO today.

Compton told the judge she would be able to pay back the rest of the money by the end of August.

“She and her husband are working together to withdraw it from his 401(k) plan,” Moye said.

Students at the elementary school missed out on new playground equipment, a year-end carnival, and other activities because of Compton’s dishonesty, PTO vice president Jennifer Johnson told the Gazette. One of Compton’s children attends the school, she said.

“Taking money from these children – that’s just sad,” Johnson said. “I can’t tell you how many volunteer hours I put in to raise that much money.”

PTO officers started getting suspicious last spring, she said. Usually, the checking account had a healthy balance of tens of thousands of dollars.

“We started receiving collection notices and bills that had not been paid, and there was no money to be found,” she said. “We didn’t have a penny.”

Compton had complete control of the finances, Johnson said.

“She would not let anyone touch the checkbook,” she said. “Even the treasurer.”

Johnson said she feels sorry for Compton’s family, but “parents need to know that there are consequences.”

In court, Compton said she would usually write PTO checks out to cash, and then use the money for herself.

She also would go to stores such as Sam’s Club and use PTO money to buy items for both the school and herself, Moye said.

“She wanted to make it right with the PTO,” he said.

The missing money caused somewhat of an uproar among West Teays parents last summer. Last July, Putnam County schools treasurer Bill Duncan went over the group’s books after parents alleged money was missing.

On Thursday, Duncan said he had turned over his findings to a police officer months ago. He said he never knew that Compton had been charged with a crime.

“I’m happy that [prosecutors] followed through with it,” Duncan said. “We lose the faith of the public if they feel that their money’s not safe. That’s my greatest concern.”

Compton was charged via an information, which usually means a defendant cooperated with investigators. She waived her right to indictment by a grand jury.

Spaulding released Compton on a $10,000 personal recognizance bond. Assistant Prosecutor Larry Frye said she had cooperated with prosecutors and was not a flight risk.

She could face one to 10 years in prison and a $2,500 fine when she is sentenced April 11.

Ex Huntington Car Dealer Pleads Guilty to Fraud

From the Charleston Daily Mail:

Ex-car dealer pleads guilty to defrauding bank

by The Associated Press

HUNTINGTON — A former car dealer who falsely obtained at least $2.5 million from BB&T through a financing scheme pleaded guilty Monday to federal fraud charges.

Frederick G. Davis of Lesage admitted that he used a line of credit for his dealership to defraud the bank. The 51-year-old Davis owned Davis Chrysler Plymouth Jeep Eagle in Huntington until 2003, when he sold it.

U.S. Attorney Charles Miller’s office says the fraud occurred from July 2001 through December 2002 and cost BB&T between $2.5 million and $7 million.

Davis pleaded guilty to one count of bank fraud and one count of engaging in an unlawful monetary transaction.

He faces up to 40 years in prison and a fine of at least $1.25 million. Sentencing is set for June 8.

Update: O’Brien, Henthorn and **** Plead Guilty in Greenbrier County Cattle/Bank Scandal

From the Beckley Register-Herald:

Note: See my earlier post regarding this case here. Each defendant faces a maximum of 30 years in federal prison. Obviously each will receive less than that. Their sentencing, which will take place in June will follow the federal sentencing guidelines, which I will not attempt to decipher in this post. Almost positively however, they all will do time. You can also read today’s Charleston Gazette article about this case here, and the Charleston Daily Mail article here. – John H. Bryan, West Virginia Criminal Defense Attorney.

Three plead guilty in cattle, bank scandal

Christian Giggenbach
Register-Herald Reporter

A businessman and two former bank officials pleaded guilty Monday in Beckley’s federal court to charges stemming from a Greenbrier County $4.2 million cattle and banking scandal.

A federal postal inspector testified that an investigation by State Police involving dirty dealings by cattle broker Kevin Scott O’Brien, of Ronceverte, also led to separate criminal charges being filed against former First National Bank of Ronceverte president and CEO Charles A. Henthorn and former First National Bank board director ****.

Last month, O’Brien, 28, was charged in an information with one count of mail fraud, but the complaint also listed several instances of fraudulent business practices including “phantom herding” — selling the same cattle to multiple buyers — check kiting, bribing a bank official, and running pyramid or “Ponzi” schemes.

Prosecutor’s say O’Brien used sophisticated schemes to defrauded investors and businesses out of $4.2 million beginning in early 2005 while brokering cattle deals in West Virginia, Illinois, Texas, Virginia and Nebraska.

Monday’s testimony revealed O’Brien signed a plea agreement with prosecutors in May 2006 and then helped police gather evidence against Henthorn, 48, by wearing an undercover wire which secretly taped the bank president incriminating himself about taking bribes.

Prosecutors then used that evidence and more in persuading Henthorn to wear an undercover wire which recorded incriminating statements made by ****.

There was no evidence that **** wore an undercover wire during the federal investigation which also included FBI and FDIC officials. State Troopers Sgt. V.S. Deeds and W.A. Pendleton, who brought their investigation to federal prosecutors, were present for Monday’s hearing.

Last month, Henthorn was charged with accepting nearly $10,000 in bribes from O’Brien, and **** was charged with aiding and abetting those bribes. Henthorn originally brokered his deal with prosecutors nine months ago and **** signed a plea agreement last August, Forbes said.

When asked why nearly two years had elapsed since O’Brien’s first contact with prosecutors, Forbes said O’Brien’s and Henthorn’s cooperation “took many months to develop.”

“There is no evidence that any criminal activity goes beyond these three defendants,” U.S. Attorney L. Anna Forbes said after the hearing.

O’Brien softly said “yes, your honor” when U.S. District Judge Thomas E. Johnston asked him point blankly: “Did you do it?”

Although O’Brien’s felony charge was specifically based on a $362,000 check he received in the mail after defrauding a Virginia cattle owner, much of Monday’s testimony concentrated on the four bribes O’Brien gave to Henthorn.

Postal Inspector Burl Fluharty testified **** introduced O’Brien to the bank president and told the cattle broker that Henthorn had “the keys to the bank.”

“**** advised O’Brien that payments to Charles Henthorn would help him procure loans,” Fluharty said. “**** facilitated these bribes to the bank president.”

Forbes said O’Brien gave Henthorn four separate bribes in late December 2005, with two cash payments totaling $2,200 and two checks written from his Shamrock Farms business account of $2,500 and $5,000. Forbes entered both checks into the court record as evidence against O’Brien and Henthorn. Henthorn was represented by Charleston lawyer James Cagle.

“It was expected that Charlie Henthorn would extend favorable treatment to Kevin O’Brien and be generally influenced in banking matters,” Fluharty told the court. No specific loan was tied to the bribes.

All three defendants posted a $10,000 unsecured bond and were immediately released after Monday’s hearing. None were available for comment. Each faces a maximum prison sentence of up to 30 years; however, it is unlikely that any of the sentences will be that stiff. Johnston set all three sentencing hearings for 10 a.m. June 30. The trio also face a bevy of fines.

O’Brien, a 1999 graduate of Greenbrier East High School, told the court he previously had worked for his father’s asphalt and excavating business and a NAPA store prior to brokering cattle deals. His federal bankruptcy case is still pending and one court official said O’Brien’s liabilities now total almost $8 million.

Forbes said “close to a dozen victims” were cheated out of money by O’Brien.

O’Brien’s defense attorney, Rodney Smith of Charleston, suggested that the $4.2 million number that prosecutors say his client defrauded investors will be challenged. Karin Nelson, who claims O’Brien cheated her out of $200,000, attended the hearing but declined comment.

Henthorn told the court he had been in the banking industry for 25 years. A former bank examiner, Henthorn resigned from First National last summer after working there for over 10 years.

****, who was represented by Charleston lawyer Michael Cary, said he began working in the real estate business with his father in 1974. He now owns two Virginia car dealerships and is a Realtor and auctioneer. **** had been on the bank’s board for eight years until his resignation last July.

— E-mail:

cgiggenbach@register-herald.com

Special Grand Jury and Special Prosecutor Called for Beating of Greenbrier County Prosecutor

From today’s Beckley Register-Herald:

Special jury called for prosecutor beating

By Christian Giggenbach
Register-Herald Reporter

LEWISBURG — A Greenbrier County judge has ordered a special grand jury to convene next month to decide if a sheriff’s deputy will be indicted for allegedly beating county prosecutor Kevin Hanson last year during a front yard altercation.

Special prosecutor Dan Dotson of Braxton County filed a motion in circuit court last week and Judge James J. Rowe issued the order Friday for a special grand jury to convene March 18. The order also states that no member of the February grand jury, which meets today, may be called for the special grand jury.

Dotson said a special grand jury was necessary because the victim in the case, Hanson, presents evidence for indictments to the regular county grand jury.

Deputy Kevin Sawyers, a seven-year veteran of the Greenbrier County Sheriff’s department, has been charged by State Police with unlawful wounding stemming from an altercation with Hanson last August.

Dotson said up to 25 citizens may be called upon to comprise the 16-person jury. At least 12 jurors must vote that probable cause exists that a crime has been committed in order to “return a true bill” or indictment.

“The people that will hear the case must not have any ties to the recent grand jury,” Dotson said by phone Monday.

Names for grand jury lists come from DMV and tax records, as well as voting registration lists, Dotson said.

During a grand jury, prosecutors normally question the arresting officer and present evidence about the alleged crime. Rules of evidence are not followed and hearsay is allowed during a grand jury.

The accused may also testify in front of a grand jury, which is rare, but it must be done outside the presence of his or her lawyer. Judges give instructions to grand juries about the elements of a crime, but are not present during any questioning.

In September, a misdemeanor battery charge was upgraded to the felony charge of unlawful wounding against Sawyers.

Hanson, the county’s prosecutor since 2001, spent several days in a local hospital recovering from his injuries. He has not been charged in the incident.

Dotson said Hanson suffered a broken nose, separated shoulder, bruises, swelling, lacerations and abrasion from Sawyers’ attack.

The criminal complaint filed by Princeton State Trooper Sgt. M.R. Crowder states Sawyers, 37, “arrived at his estranged wife’s residence” on Aug. 2 and found Hanson “in the driveway area.”

Sawyers had previously filed for divorce from his wife, who is employed as a legal assistant at the county prosecutor’s office.

Sawyers’ defense attorney, Tom Czarnik, could not be reached for comment Monday. Sawyers remains free on $2,500 bond and was placed on paid administrative leave from his job pending the resolution of his charges.

If convicted, Sawyers faces a maximum prison sentence of five years.

Note: My guess would be that this case will go to trial – before a jury. A couple of things to point out: here you have a 7-year veteran of the Sheriff’s Department beating up the elected prosecutor. He was initially charged with misdemeanor battery, but the charges were upgraded to a felony after a “special” prosecutor was brought in on the case. Much like cops, prosecutors don’t take too kindly to one of their own getting attacked. You have to wonder if the everyday bar fight – albeit with injuries requiring hospitalization – brings a felony charge. I haven’t seen very many of those. Misdemeanor battery will probably be offered as a plea, but if he takes it he surely will lose his job. Thus, I think this case will go to trial. Historically, the husband-beats-up-other-man-with-wife defense has faired pretty well before juries – even in murder cases. Furthermore, this defendant is an Iraq war veteran, and probably a pretty sympathetic guy. I give him a good shot at being acquitted. – John H. Bryan, West Virginia criminal defense attorney.

Greenbrier County Residents Headed to Federal Prison After Bank/Cattle Scandal

From the Beckley Register-Herald:

3 charged in multimillion-dollar cattle scandal involving bank

Christian Giggenbach
Register-Herald Reporter

Ending months of speculation and rumors, the U.S. Attorney’s Office in Charleston filed criminal charges Wednesday against a businessman, a former bank president and a former bank board member for alleged crimes stemming from a multimillion-dollar cattle scandal in Greenbrier County involving First National Bank of Ronceverte.

Named in the information were Kevin Scott O’Brien of Ronceverte, Charles A. Henthorn of Lewisburg and **** of Covington, Va. An information allows prosecutors to bypass a grand jury and usually indicates a defendant is cooperating with authorities.

O’Brien, 27, was charged with one felony count of frauds and swindles, according to court documents. O’Brien first made headlines in April 2006 when State Police began investigating the cattle broker after he filed a multimillion-dollar bankruptcy case.

Federal prosecutors say O’Brien brokered the sale of cattle in Greenbrier and Monroe counties and several other locations, including Virginia, Illinois, Nebraska and Texas, under the business names of Shamrock Farms and K&M Properties Investments.

Prosecutors allege O’Brien devised “schemes” to “defraud and obtain money by means of false and fraudulent pretenses” while selling cattle “at the expense of numerous farmers, banks and other business entities.”

The five-page criminal charge against O’Brien alleges in the spring of 2006 he under-reported his liabilities and distributed false financial statements to lenders and investors and “solicited and procured substantial sums of money” with the “false promise that he would invest the monies in specific cattle sale transactions.”

“It is further part of the scheme that (O’Brien) defrauded these various investors and lenders out of a total of approximately $4.2 million,” federal prosecutor L. Anna Forbes wrote.

O’Brien also allegedly engaged in “phantom herding” — selling the same group of cattle to multiple buyers — and pyramid schemes, where money from one investor is used to fund business dealings with another investor. Other allegations lodged against O’Brien include:

- Giving Henthorn, former First National Bank of Ronceverte president, bribes totaling approximately $10,000.

- Tendering worthless checks for large amounts of money.

- Directing banks to stop payment on checks for the purpose of quelling the investors’ mounting suspicions of fraud and to dissuade investors from reporting him to police.

- Engaging in check-kiting activities involving hundreds of thousands of dollars with various financial institutions to stave off financial disaster.

O’Brien could not be reached for comment Wednesday. If convicted, he faces a maximum sentence of 30 years in prison, with five years of supervised released and a possible $1 million fine.

Henthorn, who abruptly resigned as president and CEO of First National Bank of Ronceverte last June, was charged with one felony count of accepting bribes from O’Brien totaling about $9,700. Henthorn, a former bank examiner, had worked at the bank more than 10 years, starting out as a senior loan officer and vice president.

“(Henthorn in his capacity as bank president) did accept said payments by a customer … intending to be influenced in connection with business and transactions between (O’Brien) and the First National Bank,” Forbes wrote.

When reached by phone Wednesday, Henthorn refused to comment. Court documents indicated the bribe payments were paid in the fall of 2005 through December 2005.

****, who had served on the bank’s board of directors since 1999, resigned last July. **** was charged with one felony count of aiding and abetting the bribes that O’Brien gave to Henthorn. The criminal charge did not state that **** received any bribe money from O’Brien.

****, a Realtor, broker and auctioneer, owns Greenway’s Real Estate & Auction Co. and two car dealerships in Covington. When reached by phone Wednesday, he respectfully declined to talk about his pending charges.

“Everything will work its way out in the end,” he said.

Both **** and Henthorn face maximum prison sentences of 30 years each, five years of supervised release and possible $250,000 fines.

First National Bank chair Ron Snyder, who was out of town Wednesday, told The Register-Herald by phone he had not yet seen the charges leveled against his two former bank associates, but was “relieved to see this finally out in the open.”

“We are happy that this has finally been filed and now the rumors can either be quashed or reinforced,” Snyder said. “We understand the only wrongdoing were by the actions of these two individuals and this bears that out because they are the only ones that were charged.”

But left in the wake are nearly a dozen individuals, banks and businesses that O’Brien allegedly defrauded for millions of dollars. Lewisburg lawyer Steve Hunter, who represents Karin Nelson — who claims O’Brien cheated her out of more than $200,000 — said there are still many unanswered questions that need to be addressed.

“There are still pending motions left in the bankruptcy case. I still don’t think we have gotten to the bottom of this whole story and we won’t know until O’Brien is questioned under oath by lawyers representing the victims,” Hunter said Wednesday. “We still don’t know whose cattle went where and there are a lot of people who are out of a lot of money.”

Creditors named in O’Brien’s bankruptcy case include The Bank of Monroe, United Bank and Farm Credit of Lewisburg. These alone total $2.5 million. During his initial bankruptcy filing, O’Brien stated he owed First National Bank nearly $400,000. One Virginia cattle dealer filed worthless check charges against O’Brien two years ago totaling 270,000.

In August 2006, O’Brien attended one bankruptcy hearing after skipping out on several others. At that time, he invoked his Fifth Amendment right against self-incrimination more than 100 times.

Hearings to accept pleas from the three men will most likely be set in the next five days.

Note: Since the three men who were charged were charged by information rather than by indictment through a grand jury, it indicates that all three have made plea deals with the government already. Indeed, speculation for months has been that all three of these characters had in fact already made plea agreements. It has been noted through the grapevine that one of the defendants either wore a wire or had a recorded telephone conversation with the other – ensuring his conviction. With all of the rumors flying around, it will be interesting to see which of them are true. The fact of the matter is that when you are charged federally, your chances of not going to prison are extremely, extremely low. So, it is safe to say that all of these guys are going to do time in the federal pen – and deservedly so. – John H. Bryan, West Virginia criminal defense attorney.

Plea Rejected by Raleigh County Circuit Judge

From the Register-Herald today:

Plea rejected for woman accused of robbery

Michelle James
Register-Herald Reporter
A plea hearing went awry Wednesday when the defendant admitted to Raleigh County Circuit Judge H.L. Kirkpatrick she was only taking the plea because she wanted to go home, not because she thought she had done anything wrong.

Bridget Rene Sizemore, 33, of Beckley, was expected to plead guilty to first-degree robbery in connection with a March 31, 2006, incident during which she allegedly broke into a Bolt residence and attempted to steal a woman’s purse at knifepoint.

At the time of the alleged crime, Sizemore was on probation for a forgery conviction. By entering a guilty plea Tuesday, Sizemore would have been sentenced to probation for the robbery and her probation for forgery would have been revoked with the underlying sentence of one to 10 years reinstated.

Sizemore, who said she was under the influence of drugs at the time of the incident, did admit to grabbing the victim’s purse but said she was not trying to rob her.

Kirkpatrick told Sizemore he could not accept the plea and told her he believed “it would be best to just set the matter for trial.”

Sizemore was returned to jail and a trial date will be set.

Note: Defendants are forced to take plea agreements all the time despite their claim of innocence. The issue isn’t always is the person “guilty” or “innocent.” There are books and books full of technical crimes. A person could be charged with two or three different crimes for doing the same thing, just depending on what kind of mood the prosecutor was in. One crime could bring a sentence of up to one year in jail… the other crime could carry ten to twenty years in prison – mandatory. Thus, in this woman’s situation, she may not have actually “robbed” the lady, but the State may have a statement from her whereby the police officers carefully got her to unknowingly admit to each and every element of robbery, thus ensuring her conviction of “robbery” rather than simple larceny, which would be a misdemeanor. The point is, that nobody cares about her motives for pleading to a lesser unless the defendant states something in open court that could bring problems if the case ever crossed the bench of an appellate court. – John H. Bryan, West Virginia criminal defense attorney.

Former State Senator Sentenced to 2 Years

As detailed in the Charleston Gazette today, former WV State Senator Lisa Smith was sentenced to 2 years in federal prison in Alderson, and must pay the IRS 1.3 million dollars. As has been previously covered in the West Virginia Political Sweatbox Blog, this is a shining example of how politicians – especially in West Virginia – believe that they are above the law.

West Virginia legislators are like Robin Hood’s Sheriff of Nottingham. They are siphoning off every dime earned by our hard-working citizens (and then giving every dime to our non-working citizens), all-the-while lining their own pockets with silver and gold.

As an interesting side-note, at the sentencing Lisa Smith’s attorney, Tom Smith, argued that she should be given a lesser sentence because she is supposedly bipolar. He stated that “the spending, the irrational thought — that is the behavior that brings us here. Everything she did is consistent with bipolar disorder. You’re behind on your taxes so you start gift shopping? That’s not rational behavior.” Federal District Court Judge Robert C. Chambers rightly responded that her circumstances were more the result of “her greed and her arrogant pursuit of public office.” – John H. Bryan, Attorney at Law