Former circuit clerk among ten charged in scheme

By Ron Gregory ronjgregory@gmail.com

May 30, 2014

CHARLESTON — A former Logan County circuit clerk has been charged with a felony in federal district court for southern West Virginia. United States Attorney Booth Goodwin made the announcement during a hastily-called press conference Friday after in Charleston.

  • Former Circuit Clerk Alvis R. Porter, 61, of Logan was charged in an information with paying kickbacks amounting to $400,000 to Mountain Laurel Mining Complex representatives in exchange for those representatives arranging for Porter’s company to provide construction services at the Mountain Laurel complex near Sharples. Southern Construction of Logan, owned by Porter, also failed to properly report trust fund taxes for an employee, the information said. Porter faces up to five years in prison and a fine of up to $250,000. An information usually means a defendant has agreed to plead guilty in order for cooperation to occur between the federal officials and the defendant. None of the defendants were present at today’s press conference.
  • David E. Runyon, 45, of Delbarton was charged with extorting vendors for the cash kickbacks in order to assure the affected vendors received work with Mountain Laurel. Mountain Laurel is an Arch Coal, Inc. operation. Runyon served as general manager of the Sharples complex. Goodwin said Runyon and other Arch employees received nearly $2 million in kickbacks from sometime in 2007 to 2012. Runyon faces up to 25 years in prison and a $500,000 fine, if convicted. A guilty plea is considered a conviction in federal court.
  • Gary K. Griffith, 62, of Oceana, was charged with lying to federal and state law enforcement officials in the kickback investigation. According to Goodwin, Griffith was maintenance manager at Mountain Laurel and received cash kickbacks of at least $250,000 on behalf of himself and Runyon. That money came from an unnamed vendor who sold refurbished shuttle cars, the information said. When asked about receiving those kickbacks, Griffith denied it. He faces up to five years in prison and $250,000 in fines.
  • Stephen B. Herndon, 37, of Holden, is a former Mountain Laurel warehouse manager and now owner of Tri-State Mine Service, Inc. He is charged with structuring a cash withdrawal from an unnamed local bank. The “structuring” term is used by the U.S. Attorney to describe criminal conduct when an individual engages in cash transactions with a banking institutions in increments of $10,000 or less for the purpose of avoiding federal reporting requirements. Herndon could get up to five years in jail and $250,000 in fines.
  • Scott E. Ellis, 44, of Holden, is a business partner in Tri-State and he is also charged with structuring a cash withdrawal from an unnamed local bank. According to the information filed in Runyon’s case, Ellis and Herndon paid nearly $425,000 over a three-year period to receive rebuilding work from Mountain Laurel. Ellis also faced up to five years imprisonment and $250,000 in fines.
  • David N. Herndon, 63, of Chauncey, was charged with engaging in an unlawful monetary transaction of criminally derived property at a value greater than $10,000. According to Goodwin, David Herndon owned MAC Mine Service, Inc., which provided contract labor to Mountain Laurel. The prosecutor said David Herndon paid about $340,000 in illegal kickbacks to David Herndon so that Mountain Laurel would not terminate MAC Mine Service’s contract. Instead, he said, Mountain Laurel actually extended MAC Mine Service’s contract for a year because of the payoffs. David Herndon faces a fine of up to $250,000 and ten years in prison.
  • Ronald Barnette, 53, of Holden, was also charged with making a materially false statement to investigators. Goodwin alleges that the false swearing involved paying kickbacks to Runyon of approximately $300,000. His company, Mining Repairs Specialist Inc., allegedly did rebuilding miners and bolters work for Mountain Laurel. Barnette could get five years in prison and up to $250,000 in fines.
  • Gary L. Roeher, 52, of Holden, was charged with filing false tax returns. According to the information, Roeher deducted about $43,000 as a business expense for his company, CM Supply, when Roeher actually used the money to install and in-ground swimming pool at his residence. He, too, faces up to five years in prison and $250,000 in fines.
  • Chadwick J. Lusk, 32, of Davin, was charged with honest services mail fraud. He allegedly defrauded Arch Coal while purchasing agent at Mountain Laurel. The prosecutor said Lusk received illegal pay offs in a crib block kickback scheme. Rocher’s company, CM Supply Co., alleged paid Lusk a part of the profits of the crib blocks that Arch Coal purchased from CM to use at Mountain Laurel. Lusk faces up to 20 years in prison and up to $250,000 in fines.
  • James H. Evans, 39, of Verdunville, owned and operated Baisden Recycling which had a contract with Arch Coal to recycle scrap metal at Mountain Laurel. Evans was also charged with conspiracy to commit honest services fraud as he recycled scrap cable at Mountain Laurel. Evans allegedly paid Arch Coal’s $30,000 commission to Runyon through another Arch employee, Stephen Herndon, rather than Arch. Evans could get five years in prison and a fine of up to $250,000.

Goodwin said the information filing is part of his office’s “continued effort to prosecute all types of corruption in Southern West Virginia. Whether it be business, politics or other fields, our goal is to be tough on crime.”

The attorney said the charges stem from an investigation conducted by the Federal Bureau of Investigation, the Internal Revenue Service Criminal Investigation unit, the United States Postal Inspection Service and the West Virginia State Police. Assistant U.S. Attorneys Thomas C. Ryan and George Thomas are handling the prosecution. Goodwin said the investigation is “ongoing. There may be more to come.”