Thursday, June 6, 2013

Federal Bureau of Investigation probe of Foothills Regional Airport (KMRN) still not done -Morganton, North Carolina

By Sharon McBrayer
Hickory Record
 

MORGANTON, NC – It’s been nearly a year since FBI agents raided Foothills Regional Airport and seized computers, files and conducting interviews.

Airport Manager Alex Nelson and operations manager Brad Adkins pleaded guilty to engaging in a public corruption conspiracy and embezzlement. Nelson also pleaded guilty to money laundering.

Yet neither man has been sentenced for their crimes and no one else has been charged with wrongdoing, even though federal court documents say they had co-conspirators. However, the documents don’t name names.

According to recently unsealed search warrants and documents, FBI Agent James R. Meade submitted an affidavit that said Nelson and Adkins, along with the un-named co-conspirators, executed a scheme to defraud Foothills Regional Airport Authority of at least $100,000.

The document lays out information the FBI had gathered and reasons for the search warrants. Some of the information gathered included checking accounts where money stolen from the airport was hidden.

While no co-conspirators have been charged, the investigation hasn’t been closed, said Louis Vinay, attorney for the airport board of directors and for the city of Morganton. No federal documents released on the case has made mention of discrepancies in the cutting and sale of timber from airport property or money that’s been unaccounted for from the sale of two fuel trucks.

In addition to records and files at the airport and Nelson’s property, the original search warrants included any records related to former airport board chair Randy Hullette, a Morganton businessman, Hullette Aviation, Burkemont Service Center in Morganton, RANMAC Inc., Jeffrey Rose, Grady Rose Tree Service, Jimmy “Ron” Gilbert, Gilbert Grading and Construction, Simon Roofing and Parton Lumber.

An order to unseal search warrants says US Attorney for the Western District Anne M. Tompkins showed the court the original reason for sealing the documents no longer exits.

Records from SunTrust Bank showed Nelson and the airport financial officer controlled an account in the name of “Foothills Regional Airport Authority DBA Foothills Regional Aviation Alex Nelson.” Nelson and two airport authority board members also controlled an account in the name of “Foothills Regional Airport Authority c/o Alex Nelson,” the affidavit says.

Vinay said Nelson and then board chairman Wayne Abele had access to the Foothills Regional Airport Authority checking account. Vinay said he wasn’t aware of another board member who had access to it.

Vinay said there was also a checking account for the fixed-base operation, which rents hangars, sells fuel and does maintenance on airplanes. The airport authority took over the fixed-base operation in 2008 and opened the account. Nelson was apparently the only signature on that account, Vinay said.

Since the FBI raided the airport, the board merged the two accounts and now checks written for more than $1,000 need two signatures, Vinay said. Those who now have signature authority to the account are current airport Manager Brent Brinkley, board chair Bruce Roberts and board members Joe Gibbons and Don Wright, Vinay said.

In addition, Nelson controlled bogus business bank accounts, as well as a personal account with his wife.

The affidavit says on May 29, 2012, a confidential source gave agent Meade a description of the airport premises. It describes how Nelson, Adkins and a flight instructor had office space on the main floor and Nelson had another office on the second floor, adjacent to the pilot’s lounge that remained locked.

The affidavit also says Nelson and Adkins used side business accounts to deposit airport checks made out to a bogus company. One example in the affidavit is from June 2009 to September 2011, around 21 checks were deposited into Adkin’s business accounts at Community One Bank or converted into cash.

Of the checks totaling $49,000 deposited into the “Foothills Maintenance” account, $26,000 was withdrawn as cash and $22,000 was made payable to a conspirator, the affidavit says. The affidavit doesn’t name the conspirator.

Another example in the affidavit says Nelson used the airport credit card to purchase $1,400 in items from Walmart, Sam’s Club, Staples and grocery stores that exceeded anything that showed up at the airport and that he concealed itemized expenses from the airport financial officer when he submitted monthly expense reports.

In addition, money embezzled from the airport was used to fund his personal lifestyle, including purchases of a Key West vacation timeshare, a “Party Barge pontoon boat, the building of a new in-ground pool at Nelson’s residence, and cars.”

Nelson suggested to an FBI source that the source should set up a fictitious corporation not directly linked to the source’s identity so the source could bill the airport for services. “Nelson also advised that he would also use this shell corporation to move money around,” the affidavit says. The source declined the suggestion, it says.

The affidavit says Nelson and Adkins used other conspirators to defraud the airport authority by awarding numerous contracts to conspirators at grossly inflated prices for work completed or for no work at all.

An example in the affidavit says Nelson paid at least two conspirators more than $83,000 within nearly a year and a half for things such as snow removal, tree clearing, repair work or painting even though a minimal amount of the work was completed. He paid one conspirator $7,400 for tree removal along a runway but a source told FBI agents the work was never done.

The affidavit says the real property and vehicles belonging to Nelson are subject to forfeiture as substitute property for the fraud scheme. It says restraining orders aren’t sufficient to ensure the property is available for forfeiture because vehicles can easily be moved or transferred.

Meade also asked the courts to seal the affidavit and search warrants because not all the targets of the investigation would be searched at that time.

The property the FBI seized from Nelson is supposed to replace the monetary value he stole from the airport. It doesn’t really matter if the property was bought with ill-gotten gains or not, the federal government says.

The federal government filed a response recently to an argument by Nelson’s wife, Tammy S. Nelson, that the property seized were things paid for from various funds she received, not from money embezzled from the airport.

The only connection that’s pertinent between the money stolen from the airport and property seized is improvements made on the Nelson home in Lenoir, the response says. The government only has to prove the property belonged to Nelson, it says, which it has done.

When the government placed a lien against the property last June, it said there was probable cause to believe that wire fraud and conspiracy occurred and that the proceeds of the offenses are more than $100,000. It said, in part, that the property, “May be subject to forfeiture and as substitute property…”

Property the government seized and says is replacement for the money stolen from the airport is a Mercedes, Ford Expedition, Chevrolet Corvette, Sun Tracker pontoon boat, and the home at 4640 Celia Creek Road in Lenoir, which also includes the installation of a swimming pool.

In September, Nelson and Adkins agreed to help the government in any trial, hearing or grand jury proceeding, including testifying against any co-defendants.


Source:  http://www.hickoryrecord.com

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