accepting bribes, Arkansas Department of Human Services, arrests, Child and Adult Care Feeding Program, Christopher Thyer, conspiracy to fraudulent obtain USDA program funds, conspiracy to steal federal money, DHS, FBI, federal grand jury, federal indictment, Gladys King, inflated numbers, IRS, Jacqueline Mills, Judge Beth Deere, Judge Susan Wright, Little Rock AR, money laundering, paying bribes, police, Secret Service, sponsors, statutory penalties, Summer Food Service Program, Tonique Hatton, U.S. Attorney, USDA, wire fraud
Little Rock, Ark. — A former and one current Arkansas Department of Human Services (DHS) employee and one feeding program sponsor have been indicted for their roles in a conspiracy to steal federal money. Christopher R. Thyer, U.S. Attorney for the Eastern District of Arkansas, announced unsealing of an indictment and the arrest Thursday morning of Gladys Elise King, 34, of England; Tonique D. Hatton, 37, of North Little Rock; and Jacqueline D. Mills, 39, of Helena on a 76-count Indictment.
The Indictment, returned by a Federal Grand Jury on Dec. 11, charges Hatton, King, and Mills with conspiracy to fraudulently obtain U.S. Department of Agriculture (USDA) program funds. Additionally, Mills is charged with wire fraud, paying bribes, and engaging in money laundering. King and Hatton are also charged with accepting bribes.
All three defendants appeared before U.S. Magistrate Judge Beth Deere Thursday afternoon. All three entered not guilty pleas. All three were released on their own recognizance.
A jury trial was set for 9:30 a.m. Jan. 20, 2015, before U.S. District Judge Susan Webber Wright.
According to the indictment, the USDA funds the Child and Adult Care Feeding Program, which includes an at-risk afterschool component. USDA also funds the Summer Food Service Program. In Arkansas, the feeding programs are administered by DHS. Sponsors who want to participate in the feeding programs must submit an application to DHS for approval. Once approved, they can provide meals as part of the feeding program and be reimbursed based on the number of eligible meals they serve.
The indictment states that Tonique Hatton and Gladys King worked for DHS, and part of their job was to determine eligibility of sponsors to participate in the feeding programs. Mills operated as a sponsor for feeding program. Hatton and King were responsible for approving Mills’ programs at various times.
The indictment alleges that Mills made bribe payments to DHS employees Hatton and King. In exchange for those bribes, Mills would submit inflated numbers of meals purportedly served from her sites. Hatton and King would provide protection from DHS scrutiny.
To view the 12-page indictment, click HERE.
“As alleged in the Indictment, these three individuals and others were literally stealing money that was supposed to be used to feed poor and hungry children,” stated Thyer. “While I am pleased that we were able to uncover and prosecute this behavior, I am at the same time sickened that it could happen at all.”
“The Secret Service is committed to aggressively investigating those associated with this type of financially motivated crime,” stated Special Agent in Charge Brian Marr. “To steal from the mouths of hungry children in this state is unacceptable.”
“This crime directly targeted funds designated to feed disadvantaged children in Arkansas,” stated David T. Resch, Special Agent in Charge of the Little Rock FBI. “The partnership of the IRS, USDA, USSS and the FBI are committed to investigating and prosecuting these crimes to the fullest extent of the law.”
Special Agent in Charge Mary L. Lewis, Southwest Region of the U.S. Department of Agriculture – Office of the Inspector General stated, “I want to thank the U.S. Attorney’s Office, OIG special agents, and our investigative partners for their hard work on this investigation. When the integrity of nutrition programs for needy children is violated by criminal conduct, the Office of Inspector General will pursue justice to the fullest extent of the law.”
DHS Sirector John Selig said As a result of the fraudulent activity uncovered, additional steps have been taken to strengthen the oversight capacity of the Special Nutrition Unit.
— Added five fraud investigators and three senior auditors
— Requested and received additional assistance from USDA to assist monitoring and sponsor review.
— Put in place new state policies for the Summer Food Service Program aimed at improving training and program management.
— Dedicated staff to oversee and assist sponsors with complying with state and federal procurement rules.
— Further segregated job duties to ensure that the employee approving billing is not also the one responsible for monitoring the program.
— Engaged the auditors with the DHS Office of Quality Assurance to help provide further case review as needed.
In addition to unit changes, Selig ordered DHS Office of Quality Assurance senior auditors to review the unit to identify any other weaknesses and additional ways to strengthen it. That review is ongoing.
“These programs are designed to ensure financially disadvantaged children are provided with good nutritious meals throughout the year, they are not designed to enrich the program administrators,” stated Christopher A. Henry, Special Agent in Charge of the IRS-Criminal Investigation Nashville Field Office. “Individuals who engage in this type of fraud to line their own pockets with public funds should know they will not go undetected and will be held accountable.”
The statutory penalty for wire fraud and conspiracy to commit wire fraud is not more than 20 years imprisonment, not more than a $250,000 fine, or both, and not more than 3 years supervised release. The statutory penalty for receipt of bribes, paying bribes, and money laundering is not more than 10 years imprisonment, not more than a $250,000 fine, or both, and not more than 3 years supervised release.
The investigation is ongoing and is conducted by the U.S. Secret Service, Federal Bureau of Investigation, Internal Revenue Service-Criminal Investigations, U.S. Department of Agriculture – Office of the Inspector General, and U.S. Marshals Service.
Assisting with the arrests Thursday morning were deputies from the Lonoke County Sheriff’s Office and officers and detectives from the North Little Rock Police Department.
The case is being prosecuted by Assistant U.S. Attorneys Jana K. Harris and Allison W. Bragg.
Thyer noted an indictment contains only allegations. Defendants are presumed innocent until proven guilty.