Couple pleads guilty to filing false documents involving stimulus money
RICHMOND, VA (WWBT) - A Richmond couple accused of bilking the federal government out of hundreds of thousands in US stimulus money each pleaded guilty Wednesday to one count of felony filing false documents.
Morris and Chiroya Cephas face up to five years in prison and up to a $250,000 fine. They have agreed to pay restitution.
Back in 2010 they were awarded up to $500,000 in money from the US Recovery and Reinvestment Act. They were to build an open loop biomass manufacturing plant that would create 50 new jobs for Richmond. The city even held a groundbreaking for the event.
They admitted in court documents filed today to using taxpayer stimulus to purchase an excavator for the stimulus project. But the couple sold the excavator three months later at a profit of $80,000.
They admitted to using the money from the sale to pay for the rent on their Staples Trace Road home and to pay another $10,000 on loan payments for the site of the Recovery Act project that was purchased back in 2005 by a different company owned by the Cephases.
They also admitted to buying a Mack Truck with the stimulus funds and then again selling it 4 months later and using that money for loan payments.
The Cephases then tried to conceal the sale of this equipment from the government by filing a false report on the stimulus project to the US Department of Energy.
The pair originally faced a 28-count indictment for conspiracy, theft of government property and false documents. Their attorneys whittled that case down to 8 charges before today's plea deal.
An NBC12 investigation in 2012 raised questions about the spending of this money and exposed how the business, Cephas Industries, had never built the plant. We started tracking the money and even discovered that the equipment purchased with the stimulus money had been sold. After our investigation, the Office of the State Inspector General in Virginia launched its own investigation.
The Cephases will be sentenced in May.
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