Three former officials of an Arkansas nonprofit were sentenced this week for their convictions on charges of wire fraud and money laundering.
According to a release from Duane Kees, U.S. attorney for the Western District of Arkansas, 69-year-old Lawrence Shelton of El Dorado, was sentenced Monday to three years in prison, followed by three years of supervised release, on one count of conspiracy to commit wire fraud and one count of money laundering.
Ronald Murphy, 70, of El Dorado, was sentenced Tuesday to 18 months in federal prison, followed by three years of supervised release, on one count of conspiracy to commit wire fraud and one count of structuring transactions to avoid reporting requirements.
Domanique Robinson, 40, of Camden, was sentenced Tuesday to two years in federal prison, followed by three years of supervised release, on one count of conspiracy to commit wire fraud and one count of structuring transactions to evade reporting requirements.
The three men also were ordered to pay $310,000 in restitution.
The release stated that Shelton was the CEO, director and founder of Second Chance, a nonprofit that focused on “at risk” children from low-income households by helping to make them self-reliant and productive through education and mentoring. The organization, which received federal grant funding and was managed by the Arkansas Department of Human Services, was eventually investigated by the FBI and the IRS, which found that fraudulent claims were being electronically submitted to the state by Robinson, the Second Chance program director who was responsible for submitting claims with attendance numbers to the state for funding and reimbursement.
Murphy was the owner of South West Economic Development Association, which served as a food vendor for the Second Chance after-school and summer program from late 2011 until 2014.
According to the release, Shelton, Robinson and Murphy conspired to falsify claims to the state “by inflating or completely fabricating the number of children in attendance.” Those claims resulted in overpayments from the state that were direct deposited into Second Chance bank accounts by interstate wire communications, with Shelton, Robinson, Murphy and others personally benefitting from the excess funds. The release stated that the overpayments from the state exceeded $250,000 during the period of fraudulent activity.
Robinson and Murphy were indicted by a federal grand jury in 2015 and pleaded guilty in January 2016. Shelton was indicted by a federal grand jury in January 2016 and pleaded guilty in April 2017.