Rachel Dove email@example.com
July 9, 2014
By Rachel Dove
CHARLESTON – The first of 10 defendants charged with criminal activity in a kickback scheme investigation of the Mountain Laurel Mining Complex in Logan County has entered a guilty plea in federal court.
Gary Roeher, 52, of Logan County, faces up to three years in prison after admitting on Wednesday filing false tax returns, U.S. Attorney Booth Goodwin has announced. Roeher, entered the plea before U.S. District Judge Thomas E. Johnston, who also presided over the federal sentencing of former Mingo County circuit Judge Michael Thorsnbury and former county prosecutor, C. Michael Sparks.
Roeher admitted that, on his 2010 and 2011 federal tax returns, he illegally claimed business-expense deductions for kickbacks that he paid to an Arch Coal official at the company’s Mountain Laurel Mining Complex.
Roeher and the official receiving the kickbacks stole money from Arch through a dummy invoice scheme. In the scheme, Roeher would submit bills to Arch for non-existent supplies that Roeher had purportedly provided to the company. The Arch official on the other end of the scheme would then falsely certify that the supplies had been received, so that Arch’s accounting department would pay the false bills that Roeher had submitted.
After he was paid by Arch, Roeher would then pay the Arch official a kickback in exchange for his participation in the scheme. It was these kickback payments that Roeher falsely claimed as legitimate business expenses on his 2010 and 2011 tax returns.
Between 2010 and 2011, Roeher paid the known person $35,170.60 in kickbacks. In accordance with his plea agreement, Roeher has agreed to forfeit that amount to the IRS. Roeher also admitted he deducted approximately $43,000 as a business expense for his company, CM Supply, when he actually used those funds to install an in-ground swimming pool at his residence.
Roeher is scheduled to be sentenced at 2 p.m. Oct. 15 in Charleston.
Nine more guilty-plea hearings are scheduled for other defendants associated with the Arch kickback scheme, as listed below in the order they will be heard:
Alvis Porter, 9 a.m. on July 10; Gary Griffith, 1:30 p.m. on July 14; Ronald Barnette, 3 p.m. on July 14; Scott Ellis, 10 a.m. on July 16; Scott Herndon, 10:30 a.m. on July 16; David Herndon, scheduled for 10:30 a.m. on July 17; Chadwick Lusk, 10:30 a.m. on July 21; James Evans III, scheduled for 10:30 a.m. on Aug. 4; and Mingo County resident David Runyon, who is scheduled for 10 a.m. on Aug. 7.
Wednesday’s charges stem from an investigation being conducted by the FBI, IRS Criminal Investigation, U.S. Postal Inspection Service, and the West Virginia State Police. Assistant U.S. Attorney Meredith George Thomas is in charge of the prosecution.