An attorney, a tax preparer, a notary public and four clients who are sisters have been charged by a federal grand jury in Little Rock with defrauding the U.S. Department of Agriculture out of more than $11.5 million that was intended for minority farmers who were the victims of discrimination.
The defendants are sisters Lynda Charles, Rosie Bryant, Delois Bryant and Brenda Sherpell, who operated a business in North Little Rock called Jovi Women & Hispanic Litigation; Charles' daughter, Niki Charles, a notary public; Little Rock attorney Everett Martindale; and Jerry Green, a tax preparer who set up an office in North Little Rock.
Collectively, they are accused of recruiting nearly 200 people to file fraudulent claims with the USDA for discrimination in farm lending programs in the 1980s and 1990s, and collecting fees from the beneficiaries.
"The indictment alleges that the 192 claims were false because the claimants had not suffered discrimination and, in most cases, had not even attempted to farm," according to a news release issued by U.S. Attorney Cody Hiland of the Eastern District of Arkansas.
The sisters allegedly received at least $2.17 million from the scheme, which they operated from 2008 to 2017.
A total of 115 counts were filed against the seven defendants, although not all counts apply to each defendant. The charges are a mix of mail fraud, money laundering, tax evasion, false tax returns and conspiracy to defraud the IRS.
Much of the 40-page indictment contains background on two programs, the Black Farmers Discrimination Litigation settlement and the Hispanic & Women Farmers & Ranchers litigation, that resulted from class-action litigation against the federal government for systemic discrimination against minorities and women who were denied farm credit and other services by the USDA.
In each case, successful claimants could receive $50,000 plus $12,500 sent directly to the IRS as a tax withholding. According to federal prosecutors, almost all of the 192 claims the defendants submitted were approved.
Attorneys representing BFDL and HWFR claimants were limited to fees of $1,500. The indictment alleges that Everett split his fees with the four sisters, who also collected fees from the claimants. He allegedly received at least $51,000 from the scheme.
Niki Charles allegedly notarized the claim documents without having the claimants present. Prosecutors say she was paid at least $90,000 for her role in the scheme.
Prosecutors filed a civil forfeiture action in October against properties traced to proceeds of the fraud, including two lots in the Rockwater Village subdivision in North Little Rock and a house in Colleyville, Texas.