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Case Number: 4:19-cr-00688-DPM
Judge: D. Price Marshall
Court: United States District Court for the Eastern District of Arkansas (Poluski County)
Plaintiff's Attorney: United States Attorney’s Office
Description: Little Rock, Arkansas criminal law lawyer represented defendant charged with mail fraud.
Everett Martindale, age 75, admitted in court that he acted as the legal representative for claimants who filed false claims asserting they were discriminated against when they tried to get assistance from USDA for their farming operations. Martindale signed certifications that said he investigated the claims, when, in fact, he did not. The proceeds from the false claims were mailed to Martindale, and he took a portion of the money as an attorney’s fee. He also played an essential role in the process that allowed other defendants in the case to take a more substantial portion of the funds.
Martindale was the last defendant to enter a plea in the case. Lynda Charles, 72, of Hot Springs; Rosie Bryant, 74, of Colleyville, Texas; Delois Bryant, 75, of North Little Rock; and Brenda Sherpell, 72, of Gainesville, Texas, each pleaded guilty on July 6, 2022, to conspiracy to commit mail fraud and to defraud the Internal Revenue Service. Niki Charles, 49, who is the daughter of Lynda Charles, pleaded guilty on Tuesday to conspiracy to commit mail fraud based on her role in notarizing affidavits that she knew to be false and soliciting people to file false claims.
The sisters also admitted that they hired a tax preparer to falsify tax returns, resulting in failure to report over $4.6 million to the Internal Revenue Service. That tax preparer, Jerry Green, pleaded guilty in January 2021. Judge Marshall will sentence all defendants at a later date.
As documented in plea agreements, the defendants submitted claims under two programs: the Black Farmers Discrimination Litigation (BFDL) settlement and the Hispanic and Women Farmers and Ranchers (HWFR) claim program. The BFDL settlement resulted from a class action lawsuit filed in 1997 in which a group of black farmers claimed they had been discriminated against when they applied for farm credit, credit servicing, or farm benefits from USDA. Similarly, the HWFR claim program was created after groups of Hispanic and women farmers filed separate lawsuits against USDA, also alleging discrimination in their farm benefit programs.
Both BFDL and HWFR resulted in a claims process where farmers who could show they had applied for participation in a USDA benefit program and believed they had been discriminated against could make a claim for financial relief. A successful claim resulted in an award of $62,500. Of that, $50,000 would be made payable to the claimant, and $12,500 would be transferred directly to the Internal Revenue Service as a tax withholding. Altogether, the sisters were involved with 192 claims, almost all of which were successful, resulting in a loss of over $11.5 million. The claims were false because the claimants had not suffered discrimination and, in most cases, had not even attempted to farm.
The indictment alleged that Martindale would deposit claim checks into his law firm trust account, issue a check from that trust account to the claimant, and withhold his attorney fee. For both BFDL and HWFR, attorney fees were restricted to $1,500 per claimant. The four sisters entered an agreement with Martindale in which they would split the attorney fee. The sisters, with Martindale’s help, also demanded and received additional money from the claimants themselves.
The money received from a claim was income that should have been reported on the claimant’s tax return. The sisters and their accountant, Green, admitted that Green provided tax preparation services for the claimants they had recruited and that Green falsified the tax returns in order to create a tax refund.
Three of the sisters—Lynda Charles, Rosie Bryant, and Delois Bryant—filed false tax returns of their own and used money from the conspiracy to purchase homes and other properties, including a Chevrolet van, and a Mercedes G550. Pursuant to the plea agreement, the sisters are required to relinquish any claim to the vehicles and to repay the fraud money they used to purchase properties. The money is due by the time they are sentenced, which has not yet been scheduled.
The investigation is being conducted by USDA-OIG and IRS Criminal Investigations with assistance from the United States Marshals Service and the United States Postal Inspection Service. The case is being prosecuted by Assistant United States Attorneys Cameron McCree, Bart Dickinson, and Amanda Fields.
18:371 Aiding and Abetting Mail Fraud
Outcome: Defendant pleaded guilty.