| U.S. Department of Justice
Ronald C. Machen Jr.
United States Attorney for the District of Columbia
Judiciary Center
555 Fourth Street, N.W.
Washington, D.C. 20530
PRESS RELEASE
Founder of Non-Profit Pleads Guilty to Felony Charge in Investigation
Involving Misuse of $392,000 in Grant Money
Admits Covering Up Activities by Former Council Member
Harry L. Thomas, Jr.
Marshall D. Banks, the founder of a non-profit organization that
operated youth programs in the District of Columbia, pled guilty to a
felony charge stemming from his failure to report and effort to conceal
the misappropriation of $392,000 in government grants.
The guilty plea was announced by U.S. Attorney Ronald C. Machen Jr.;
James W. McJunkin, Assistant Director in Charge of the FBI Washington
Field Office's Criminal Division, and Eric Hylton, Acting Special Agent in
Charge of the Washington Field Office of the Internal Revenue
Service-Criminal Investigation (IRS-CI).
Banks, 71, of Washington, D.C., pled guilty in the U.S. District Court
for the District of Columbia to a criminal information charging him with
one count of misprision of a felony (theft or bribery concerning programs
receiving federal funds). As part of the plea agreement, Banks agreed to
cooperate in any criminal investigation or prosecution.
Today's plea comes one week after the guilty plea of former District of
Columbia Council member Harry L. Thmas, Jr., on charges that also involve
the grant money.
A sentencing date has not yet been set. The Honorable John D. Banks
scheduled a status hearing for May 25, 2012. The charge carries a maximum
penalty of three years in prison, as well as a possible fine and an order
to make restitution. Under federal sentencing guidelines, the parties have
agreed that the applicable range would be a maximum of six months of
incarceration and a fine of up to $5,000. Also, as part of the plea
agreement, Banks agreed to be jointly and severally liable with others
responsible for the crimes for paying $392,000 in restitution to victims
of his conduct.
"Public corruption is allowed to flourish when ordinary citizens
remain silent in the face of obvious wrongdoing," said U.S. Attorney
Machen. "While Harry Thomas lined his pockets with money meant to
benefit children, he was unable to do so alone. Marshall Banks stood by
while Thomas stole the money and instead of reporting it, actively helped
to conceal the fact that grant funds were being funneled back to Thomas.
Today's guilty plea underscores the importance of standing up and speaking
out against public officials who are on the take."
"By concealing the failing to report the illegal use of public
funds, Mr. Banks allowed for money to be stolen from its intended use for
the youth programs in the District of Columbia," said Assistant
Director McJunkin. "Such illegal behavior is unacceptable, and those
who commit such acts will be held accountable. We urge anyone with
information about corruption to come forward and contact the FBI."
"IRS-Criminal Investigation pulls the skills of each agency to
make a formidable team as we investigate allegations of wrongdoing."
said Acting Special Agent in Charge Hylton. "Today's actions
demonstrate our collective efforts to enforce the law and ensure public
trust."
According to a statement of offense signed by the government as well as
the defendant, Banks was the founder and director of the Langston in the
21st Century Foundation (Langston 21), a non-profit organization that
operated youth activities designed to foster educational advancement,
including programs at Langston Golf Course in the District of Columbia.
Through his responsibilities at Langston 21, he worked with James
Garvin, a board member for Langston 21 and the general manager of the golf
course.
The statement of offense says that Thomas, the District of Columbia
Council member who represented Ward 5, informed Garvin in 2007 that he
wanted to obtain grant funds to conduct activities in the ward. Thomas
informed Garvin that Thomas needed a non-profit organization to act as the
recipient of the money. Thomas also stated that a portion of the funds
could be dedicated to youth programs at Langston Golf Course.
At Thomas's request, Garvin asked Banks whether Langston 21 would serve
as the non-profit needed by Thomas to receive the grant funds and forward
money to Thomas. Banks agreed. Langston 21 then executed a grant agreement
for $392,000 with a non-profit public-private partnership that got funding
from the District government.
Thomas told Garvin that Team Thomas, an organization he controlled,
would be a suitable organization to carry out the grant. However, neither
Thomas or Team Thomas were mentioned in the agreement with the
public-private partnership.
In January, May, October and December of 2008, the public-private
partnership issued quarterly grant payments to Langston 21. At or about
the time of each check, Thomas directed Garvin or Banks to have Langston
21 issue checks to either Team Thomas or another organization, HLT
Development, that Thomas also controlled.
Langston 21 received $392,000 in grant funds from the public-private
partnership. From that grant money, Garvin and Banks issued checks to Team
Thomas and HLT totaling $306,000.
Banks knew that the documentation used for the grants contained false
representations.
In addition, Banks knew that no D.C. youth were brought to the Langston
golf course by Thomas to participate in grant-related activities. Sometime
before October 2008, Banks determined that Thomas was not using the grant
funds for their designated purposes. Yet he continued to deposit grant
funds into Langston 21's bank account and then write checks to Team Thomas
and HTL with the term "youth sports" or "learning
center" on the memo lines.
Banks did not report the improprieties to authorities, even though he
knew Thomas was using money for his personal benefit,, and he helped
Thomas to conceal his actions.
Thomas, 51, pled guilty on January 6, 2012 in the U.S.. District Court
for the District of Columbia to a criminal Information charging him with
one court of theft concerning programs receiving federal funds and one
court of filing a false tax return. As part of the plea agreement, he
agreed to submit his resignation from the District of Columbia Council.
Thomas is to be sentenced by Judge Bates on May 3, 2012. The investigation
is continuing.
In announcing the plea, U.S. Attorney Machen, Assistant Director
McJunkin, and Acting Special Agent in Charge Hylton commended the work of
those who investigated the case for the FBI and IRS-CI.
They also acknowledged the efforts of Assistant U.S. Attorneys Jonathan
W. Haray, Courtney G. Saleski, Bridget M. Fitzpatrick, Ellen Chubin
Epstein and Matthew Graves of the Fraud and Public Corruption Section in
the U.S. Attorney's Office for the District of Columbia, and Trial
Attorney Peter Mason of the Public Integrity Section of the Department of
Justice's Criminal Division, who have prosecuted the case.
Finally, they expressed appreciation to Criminal Investigators Matthew
Kutz, Mark Crawford and Melissa Matthews, Paralegal Specialists Tasha
Harris, Diane Hayes, Sarah Reis, Shanna Hays, Lenissa Edloe and Monica
Johnson; Legal Assistants Jared Forney and Krishawn Graham and Litigation
Technology Specialist Tracy Van Atta, all of the U.S. Attorney's Office. |
