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West Kentucky Businessman and Employee Indicted On Wire Fraud Charges

U.S. Attorney For Western District Of TN Facebook page

A federal grand jury has issued a federal indictment for a west Kentucky businessman and his employee on wire fraud charges.

The office U.S. District Attorney for West Tennessee Michael Dunavant is prosecuting the case.

Prosecutors allege Charles “Chuck” Jones and Mark Whitaker both of Murray participated in a scheme to defraud the federal E-Rate program which provided funding to schools to purchase internet access and other telecommunications services and equipment.

The indictment said Jones and Whitaker provided money and other gifts to a co-conspirator to steer business toward Jones’ now-shuttered tech businesses. WKMS has previously reported the co-conspirator was Ashley Jordan who served as the Director of Technology for Crockett County Schools in Tennessee, he also served as a consultant for some Missouri school districts.

The indictment states Jones’ companies received approximately $8.5 million from the E-Rate Program.

Dunavant said in a release that the protection of federal grant programs is a top priority for his office. "When dishonest offenders conspire to defraud these programs for their own selfish gain and unjust enrichment, they not only steal tax dollars but also hurt local schools in the process. We will continue to work with our federal partners to root out and expose such fraud against the government, to hold offenders accountable, and to recover ill-gotten gains,” Dunavant said.

Federal Communications Commission Inspector General David Hunt said in a release that the FCC will continue to work with law enforcement to pursue those who seek to illegally take money from the commission’s programs. "Today’s charges allege that Mr. Jones and Mr. Whitaker knowingly and willfully violated the bedrock requirements of the FCC’s E-rate Program while hiding these violations from the Program’s administrator, all with the goal of enriching Mr. Jones with E-rate funds, thus depriving students of the benefits of this program – up-to-date telecommunications services,” Hunt said.

Jones issued a statement claiming the charges are “categorically false” and intended to defame his character.

Here is Jones’ full statement:

“Today, an indictment was filed against me relating to two companies I used to own. I started one of those companies in 1993 and the other in 2002. Every single school with whom we contracted received internet access, equipment and/or other services as contractually outlined, and any claims stating otherwise are a fabrication in an attempt to defame my character. I believe this action today is a result of a well-publicized business dispute dating back to 2012 with a former business partner, David Griffin, who was involved in one of the businesses. In fact, some of these allegations go back nearly 20 years and have been the subject of substantial litigation between me and Griffin. The claims in the indictment are categorically false and I look forward to defending these charges made against me and my work.”

Whitaker has not responded to a request for comment.

Jones has been the center of several lawsuits in recent years involving alleged copyright infringement and breaching loan agreements.

Jones is currently the President and CEO of R.H. Resolute Distillery Inc. in Paducah.

The case was investigated by the FCC Office of Inspector General and the Federal Bureau of Investigation. Assistant United States Attorneys Tony Arvin and Murre Foster are prosecuting this case on the government’s behalf.

The west Tennessee U.S. District Court Clerk’s office said Jones is scheduled to make a court appearance in Memphis on February 12 and Whitaker is scheduled to make an appearance on February 19.   

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