Several people were recently indicted on 32 charges alleging several conspiracies related to the Prichard Water Works and Sewer Board.
U.S. Attorney Sean P. Costello said the investigation found approximately $2.4 million taken from the Prichard Water Board.
Costello said five defendants were indicted, and two have already pleaded guilty.
Nia Bradley, 50, of Mobile; Randy Burden, 47, of Prichard; Steve Jones, 61, of Mobile; Larry Knight, 35, of Mobile; Dejuan Lamar, 47, of Mobile, were charged with various federal crimes.
Ayanna Payton, 47, of Eight Mile, and Stephanie Hunn, 49, of Mobile, were previously charged and have pleaded guilty.
"The taxpayers of the Southern District of Alabama deserve to be able to rely on competent, honest public servants," said Costello. "This indictment is the result of careful, thorough, and meticulous investigation. Together with our partners in law enforcement, we will continue our efforts to protect the taxpayers and hold accountable thieves who seek to enrich themselves at the expense of our community."
The indictments stated that as early as 2018, the defendants operated a fraudulent contractor scheme involving water board employees, outside contractors and employees. Prosecutors alleged the money was laundered through a business owned by Bradley and Burden.
"Fraud and theft by government employees from the very people they are put in place to serve will not be tolerated," said FBI Mobile Division Supervisory Special Agent Parker Still. "This investigation is another example of law enforcement cooperation between federal, state and local entities to ensure people have trust in their public works."
The United States is seeking money judgments in the amounts of approximately $2,459,279.39, $960,851.41, and $302,134.90, as well as the forfeiture of three real properties that were purchased using fraud proceeds and involved in the money laundering scheme.
Coded messages were used to communicate between the suspected co-conspirators. They are accused of destroying evidence to avoid detection.
There will also be state charges in connection with the alleged fraud.
The announcement came on the same day as a planned town hall regarding Prichard Water Works. Court-appointed receiver John Young addressed outdated infrastructure and operational failures that led to fraud and put Prichard's people into a public health crisis.
The federal charges are listed below:
Nia Bradley is charged with conspiracy to commit mail, bank, and wire fraud; conspiracy to defraud the United States (taxes); money laundering conspiracy; wire fraud; bank fraud; and related tax charges.
Randy Burden is charged with conspiracy to commit mail, bank, and wire fraud, money laundering conspiracy, and bank fraud.
Steve Jones is charged with conspiracy to commit mail, bank, and wire fraud; money laundering conspiracy; bank fraud; and filing false tax returns.
Larry Knight and Dejuan Lamar are charged with conspiracy to commit mail, bank, and wire fraud and bank fraud.
All defendants are considered innocent until proven guilty.
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