A Marianna man pleaded guilty Friday to a charge of conspiracy to commit wire fraud, admitting he was part of a scheme to steal federal funds intended to feed children in low-income areas during the school year.
James E. Franklin Jr., 34, will be sentenced at a later date by U.S. District Judge D. Price Marshall Jr.
Franklin admitted to Marshall that in the summer of 2013, he and Anthony Waits, who is facing a related federal jury trial in October, drove to a bank to meet Dorothy Harper, who is also awaiting trial in October. Franklin told the judge that Waits got out of the vehicle he was in, approached Harper's vehicle and then returned with a stack of cash that Franklin estimated to be about $12,000.
U.S. Attorney Chris Thyer said Friday that at the time, Franklin had limited knowledge about the feeding program, through which the U.S. Department of Agriculture provides funds, administered by the state Department of Human Services, to reimburse approved sponsors for feeding at-risk children.
But after Franklin saw the large amount of cash, Waits explained the scheme to him in more detail, and Franklin agreed to participate, Thyer said.
As an approved sponsor for a feeding program through an organization called JL&N Outreach, Franklin submitted about 12 inflated claims for feeding sites he said he operated in Brinkley and Hughes in 2013 and 2014, Thyer said.
Franklin falsely claimed he fed between 217 to 287 children a day in Brinkley, and falsely claimed he fed from 184 to 244 children a day in Hughes, when in reality, witnesses reported no more than 10 children were fed each day in Brinkley and no more than 15 children were fed daily in Hughes, according to Thyer's news release.
Through the inflated claims, Franklin received about $380,355 from the state, Thyer said. He said Franklin paid Anthony Waits about 40 percent of the stolen money and withdrew about $252,000 of the funds in cash.
Franklin is the 10th person to plead guilty in the feeding-program fraud case. Previous charges stemming from the investigation have detailed alleged fraud of more than $10 million in USDA feeding program funds.
The mail-fraud conspiracy charge is punishable by up to 20 years in prison and a fine of up to $250,000.
Thyer said the investigation is still being conducted by the USDA-Office of Inspector General, the FBI, the IRS-Criminal Investigations Division and the U.S. Marshals Service.
The assistant U.S. attorneys prosecuting the cases in the Eastern District of Arkansas are Jana Harris, Allison Bragg and Cameron McCree.
Thyer urged anyone with knowledge of any fraudulent activity regarding the feeding programs to email the information to [email protected].
Metro on 09/17/2016