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King Coal CEO Stephen Parks Pleads Guilty to Wire Fraud

3 min read

King Coal CEO Stephen L. Parks of Little Rock has waived indictment and pleaded guilty to one count of wire fraud relating to a fraudulent investment scheme, Chris Thyer, the U.S. Attorney for Arkansas’ Eastern District, announced Wednesday. 

The plea agreement, which is subject to approval by U.S. District Court Judge Leon Holmes, stipulates a sentence of 27 months imprisonment and multiple forfeitures, including $7.5 million, an office building, jewelry and a 2008 Bentley.

Parks was ordered to pay $845,000 in restitution to the IRS, but that will come from the forfeited money. Parks had contested the forfeitures, which were associated with tax credits not included in the charge to which he pleaded guilty, but the plea deal required him to stop fighting over those tax credits.

“With today’s guilty plea, Parks admitted his role in a scheme to finance his own lifestyle at the expense of the American taxpayer,” FBI Assistant Special Agent in Charge David Shepard said in a news release.

More: Read the information in the case from the U.S. Attorney’s office (PDF).

In a statement, Parks’ attorney, Dustin McDaniel, said Parks “regrets the mistakes that he made in the course of extremely complicated business dealings.

“He accepted responsibility for that today and looks forward to putting this matter behind him and get on with his life,” McDaniel said.

More: Read a full statement from Stephen Parks’ attorney, Dustin McDaniel (PDF).

The waive-and-plea comes more than two years after the IRS seized records from the Heights home Parks’ shares with his wife, Anna Harper. The purpose of the seizures was unclear.

On Wednesday, Thyer said Parks sold non-existent refined coal tax credits and used the proceeds to buy a home in Little Rock’s Heights neighborhood, among other things.

Parks established King Coal, a limited liability company, in 2007 to mine and produce refined coal from surface and deep mines in Arkansas, as well as pursue other coal-related ventures. In 2010, Parks formed Global Coal LLC, serving as its CEO, president and general manager. He was also president of Ecotec Coal LLC. 

Despite Global Coal never having filed a federal tax return, refined coal or sold coal, Parks sold nonexistent Global Coal refined coal tax credits through a broker to an investor for $723,450, according to Thyer.

“Despite the fact that no federal tax return for Global Coal LLC was filed; no coal was produced, refined, or sold to an unrelated third party; and Global Coal LLC had no facility in place to refine coal, Parks approved the sale of the non-existent federal tax credits,” Thyer said. “He then used the fraudulently obtained funds to give his wife $40,000 and purchase a house in the Heights, which was intended to be torn down and used as a back yard for his family.”

Parks and his wife, Anna Harper, live in a 6,000-SF home at 2020 N. Spruce St. near the County Club of Little Rock. In 2012, King Coal Holdings LLC, a Parks-controlled entity, paid $300,000 for a 1,450-SF house at 4817 Stonewall Road, which is adjacent to their home. 

That same year, King Coal Holdings LLC purchased a 21,080-SF office building at 1616 Brookwood Drive in Riverdale in Little Rock for $850,000. The property became the new home for King Coal LLC.

“We’ve broken ground,” Parks told Arkansas Business at the time. “We’re giving the building a facelift to make that place special. It’s where we’re going to put our lab.”

That office was among the forfeitures announced by the U.S. Attorney on Wednesday.

In his statement, McDaniel said “it is important to recognize” that Harper, who operates an estate sale company, “did nothing wrong and has been released from any further criminal inquiry in this matter.

“Her reputation, business and health have all been impacted by an investigation that ultimately yielded one wire fraud charge against her husband for an unrelated transaction,” he said.

“Mr. Parks strongly contends that King Coal LLC was actually in the process of producing refined coal,” McDaniel said. “The government seized neither the mining equipment nor supplies, and they are at the coal mine in western Arkansas today.”

McDaniel said the coal mine is near Mena, and while King Coal is still a going concern, Parks has agreed to divest his holdings in it and the other companies.

A sentencing date for Parks has not been set. Parks will have the opportunity to withdraw his guilty plea if the court does not accept the plea deal.

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