A Marianna man who admitted in September that he participated in a scheme to defraud a federally funded feeding program for underprivileged children was sentenced Tuesday to two years in prison and ordered to repay $380,055.36 to the U.S. Department of Agriculture.
U.S. District Judge D. Price Marshall Jr. sentenced James E. Franklin Jr., 34, on his pre-indictment guilty plea to a charge of conspiracy to commit wire fraud. The charge carries a statutory penalty of up to 20 years in prison and a fine of up to $250,000.
According to court documents, he participated between August 2013 and September 2014 as a sponsor in the USDA's Child Nutrition Programs in Arkansas, through an entity called JL&N Outreach, after being recruited through a friend, Anthony Waits. Waits was married at the time to Gladys Waits, also known as Gladys King, who was an employee of the state Department of Human Services, which administered the programs.
Gladys Waits is one of two former DHS employees who has admitted to approving the applications of prospective sponsors, despite knowing that they intended to commit fraud. She is awaiting sentencing. Anthony Waits, 38, of England is among three people set for a jury trial beginning the last week of March in another federal courtroom.
Franklin has admitted that he set up feeding sites in Brinkley and Hughes, which prosecutors say served food to about 25 children a day combined. He admitted that that he later submitted reimbursement forms through DHS that inflated the number of children he fed. The claims indicated that he fed 217 to 287 children daily at the Brinkley location and 184 to 244 children at the Hughes location.
During his participation, he said, he received advice and instructions about submitting the claims from Gladys Waits, and received payment from DHS of $380,055.56. Franklin told the judge that he paid 40 percent of his proceeds to Anthony Waits.
While his attorney, Michael Spades, asked that the judge consider that the crime is Franklin's first offense and that other participants who have pleaded guilty in feeding program fraud cases have stolen more money, Assistant U.S. Attorney Jana Harris noted that Franklin carried out his crimes over 14 months in a manner that took a lot of planning.
He had to form a corporation and file it with the Arkansas secretary of state's office, open a bank account to receive direct deposits from the claims, find and rent two locations in Brinkley and Hughes, and hire people to work at them, she said.
"While a handful of children were fed, this program was set up as fraud from its inception," Harris argued in a sentencing memorandum. "The rented locations and few children who were fed were all done to give the appearance of a legitimate program. Most importantly, this money was intended to feed children in low income areas. Instead, Mr. Franklin was able to make personal purchases for himself, including a trip to Las Vegas and two used cars for a business, and cash payments to defendant Anthony Waits."
Harris said that Franklin "was among several who were recruited by Anthony Waits to participate in the feeding programs and pay Waits a portion of the proceeds." She said one of those who stole $182,728 had been sentenced to 21 months in prison, and Franklin's sentence should be higher, at 27 months.
"To the extent Franklin argues that he was involved in one conspiracy and that he was a minor player, that's not the case," Harris argued, noting that there were "multiple conspiracies."
Spades' sentencing memorandum notes that Franklin is married with an eight-year-old son and a 10-year-old stepson, and that he is a member of the U.S. Army, though a "military separation process" is in progress as a result of his conviction.
Spades revealed that Franklin worked from 2010 until 2013 as a nutrition and food service associate at the Department of Veterans Affairs in Dallas, and that he has also been a rural mail carrier.
Franklin is the fourth person to be sentenced in a feeding program fraud case, while eight others have pleaded guilty and are awaiting sentencing, according to the U.S. attorney's office.
Metro on 01/11/2017