Matt J. Whitworth, Acting United States Attorney for the Western District of Missouri, announced Friday that the former street department superintendent for the city of Nixa, Mo., along with his wife and another former city worker, have been indicted by a federal grand jury for a series of mail fraud and money laundering schemes totaling more than $756,000.
Larry W. Covington, 49, and his wife, Paula K. Covington, 52, both of Ash Grove, Mo., and David W. Griggs, 44, of Willard, Mo., were charged in a 51-count indictment returned under seal by a federal grand jury in Springfield on yesterday (05-14-09). That indictment was unsealed and made public Friday upon the arrest and initial court appearance of Griggs.
The federal indictment replaces a criminal complaint that was filed against Griggs on April 15, 2009.
Covington was employed by the city of Nixa from March 6, 2000, to Feb. 23, 2009. He was appointed to be the superintendent of the street department on May 6, 2004.
Griggs was employed as a utility worker in the city street department from Nov. 6, 2003, to Feb. 8, 2006. He was promoted to be the lead utility worker on Aug. 4, 2004.
The federal indictment alleges that Larry Covington and Griggs participated in a conspiracy to defraud the city of Nixa. They allegedly used two businesses established by Griggs - Airborne Specialist (sometimes referred to as Airborne Specialists) and Tri-State Supply - to invoice the city of Nixa for approximately $273,645 in goods and services that were never provided.
The federal indictment also alleges that Larry Covington used a business that he established - Ward & Spooner - to invoice the city of Nixa for approximately $482,365 in goods and services that were never provided.
Mail Fraud Conspiracy:
According to the indictment, Larry Covington and Griggs participated in a mail fraud conspiracy from Oct. 18, 2004, to Feb. 25, 2009. Larry Covington allegedly initiated fraudulent purchase orders for goods and services to be supplied to the city of Nixa by Airborne Specialist/s (Grigg's fake business.)
Larry Covington allegedly submitted 83 fraudulent invoices to the city, totaling $183,435, for goods and services that were never provided by Airborne Specialist(s). In each case, the indictment says, Larry Covington acknowledged receipt of these goods, which were never received.
As part of the conspiracy, the indictment says, Larry Covington also submitted 39 fraudulent invoices from Tri-State Supply to the city of Nixa, totaling $90,209, for goods and services that were never provided by Tri-State Supply. In each case, the indictment says, Larry Covington acknowledged receipt of these goods, which were never received.
Griggs established separate post office boxes for the two businesses. When the city mailed checks payable to the businesses, the indictment says, they were deposited into business bank accounts. Larry Covington and Griggs then split the proceeds of the fraudulent invoices.
In addition to the conspiracy, Larry Covington and Griggs are charged with 11 related counts of mail fraud.
Ward & Spooner Scheme (Covington's bogus company):
According to the indictment, Larry Covington repeatedly used Ward & Spooner to invoice the city of Nixa for goods and services that were never provided. Between Dec. 7, 2004, and Feb. 25, 2009, Larry Covington allegedly submitted 150 fraudulent invoices totaling $482,365 to the city of Nixa for goods and services that were never provided. Larry Covington repeatedly made false representations to the city that Ward & Spooner would supply goods and services, the indictment says, and falsely represented to the city that goods had been delivered and that services had been performed by Ward & Spooner by signing or initialing fraudulent invoices.
Larry Covington established a post office for Ward & Spooner. When the city mailed checks payable to Ward & Spooner, the indictment says, they were deposited into a business bank account.
Larry Covington is charged with 11 counts of mail fraud related to this scheme.
All three defendants are charged with participating in a money laundering conspiracy. According to the federal indictment, between Oct. 18, 2004, and Feb. 25, 2009, Larry and Paula Covington and Griggs conspired to conduct financial transactions involving the proceeds of the alleged mail fraud.
In addition to the conspiracy, Larry Covington is charged with 13 counts of money laundering, Paula Covington is charged with two counts of money laundering and Griggs is charged with two counts of money laundering.
Additionally, Larry Covington is charged with 10 counts of embezzling from an organization receiving federal funds, and Griggs is charged with him in six of those counts.
The indictment also contains forfeiture allegations, which would require the Covingtons and Griggs to forfeit to the government $756,010 as well as their residential property in Ash Grove, a 2004 Bombadier Outlander, three trailers, a 2007 Mahindra tractor, a 2007 Mahindra loader, a 2007 Agri cutter, a 2008 Ford F350 truck, a 2008 Ford Explorer, a Smith & Wesson .22-caliber automatic pistol, a Colt .45-caliber revolver and a Benelli M1.
Read Indictment Here