Julia Roberts Goad

Staff Writer

CHARLESTON — Several local men have been charged in Federal Court with a scheme to defraud BrickStreet Insurance, thereby lowering the Worker’s Compensation insurance premiums for mining contracting companies.

According the U.S. Attorney Booth Goodwin, Arville Sargent, 52, of Chapmanville, was working as an auditor for BrickStreet, where he conducted field audits of companies who supplied contract miners to companies such as Alpha Natural Resources and Patriot Coal.

According to court records, Sargent is accused of accepting bribes from Frelin Workman, 58, of Belfry, Ky. and Eddie Russell, 50, of Williamson, who own Aracoma Contracting; Frelin’s son Randy Workman, 36, of Belfry, owner of Christian Contracting; and Arthur White, Jr., 60, of Lenore, owner of T&W Services.

Two other mining contractors, Allen Workman, who is Frelin Workman’s brother, and Melvin Parsley, both of Williamson, have already pleaded guilty in Virginia as part of a scheme to withdraw $10 million bribe mine supply purchasers.

In order to calculate a policy holder’s Worker’s Compensation insurance premiums, BrickStreet’s auditor uses information including the policy holder’s payroll records, quarterly employment tax filings and unemployment compensation forms.

The U.S. Attorney’s office alleges that, while working as an auditor, Sargent accepted bribes from the four contracting firms to under report information from the companies’ payroll records in order to lower their premiums.

“Mine safety is unquestionably a priority of my office,” said U.S. Attorney Booth Goodwin. “Today’s filings underscore my commitment to approach this important issue from every angle.”

Prosecutors are seeking to seize $415,000 they say is traceable to Sargent’s crimes, including $226,000 in cash from a safe deposit box. The government also is seeking to seize from Sargent a Dodge Ram truck, a Harley-Davidson motorcycle and a Yamaha ATV, court records show.

Russell and Frelin Workman admitted paying a significant number of their employees in cash as part of a tax evasion scheme to avoid the associated payroll taxes, Goodwin said.

Randy Workman also used cash payments to evade payroll taxes, the prosecutor said. White, paid a portion of the payroll for T&W Services LLC through a shell company to avoid paying taxes.

Sargent, Russell, Frelin Workman and Randy Workman each face up to 25 years in prison and a $500,000 fine.

White faces up to ten years in prison and a $500,000 fine.

“Employers in the coal mining industry who cheat the workers’ compensation insurance system are really only cheating the hard-working miners who risk injury to perform dangerous jobs to provide for their families,” he said. Goodwin said in a statement. “This type of corruption has long plagued the coal industry in southern West Virginia and must be stopped.”