Morgan County Judge Executive and Owners of Salyersville-Based Bridge Contractor Indicted in Connection with Kickback Scheme, Fraud, and Money Laundering
|U.S. Attorney’s Office December 09, 2013|
LEXINGTON—Timothy Alexander Conley, the Morgan County judge executive, has been charged with soliciting and accepting kickbacks from a Salyersville, Kentucky-based bridge contractor in exchange for contract awards, according to a federal indictment unsealed today.
The indictment, filed under seal on Thursday, December 5, charges Conley and Kenneth Lee Gambill and Ruth L. Gambill, the co-owners of PBTHNOJJ Construction, with several offenses arising from the kickback scheme. Conley and Kenneth Gambill are both charged with four counts of mail fraud and one count of theft from a program receiving federal funds. All three defendants are also charged with conspiring to launder money.
Specifically, the indictment alleges that, from early 2009 until August 2013, as part of a mail fraud scheme, Conley rigged competitive bidding processes to select PBTHNOJJ Construction for Morgan County construction contracts. After obtaining PBTHNOJJ Construction’s payments for these contracts, Kenneth Gambill then delivered to Conley cash kickbacks from the contract proceeds.
In addition, Conley and Kenneth Gambill are charged with defrauding a federally funded program. The indictment alleges that Conley misappropriated money from Morgan County, which received federal funding for emergency services, debris cleanup, and rebuilding efforts following a tornado that swept through West Liberty, Kentucky, on March 2, 2012. As part of the debris cleanup effort, Morgan County contracted with PBTHNOJJ Construction and other entities. Conley allegedly abused his position to ensure that PBTHNOJJ Construction received excessive payments for this work.
Finally, Conley, Kenneth Gambill, and Ruth Gambill are charged with conspiring to launder the proceeds of these crimes, in order to promote ongoing illegal activities and conceal the nature and source of the funds, among other things.
Kerry B. Harvey, U.S. Attorney for the Eastern District of Kentucky; Perrye Turner, Special Agent in Charge, FBI; and Jack Conway, Kentucky Attorney General, jointly announced the indictment today.
The investigation preceding the indictment was conducted by the FBI and the Kentucky Attorney General’s Office. The indictment was presented to the grand jury by Assistant U.S. Attorney Andrew T. Boone.
Conley is scheduled to appear in federal court on Tuesday, December 10 in Lexington at 3:00 p.m. Kenneth Gambill will appear in court on December 30 in Lexington. A date for Ruth Gambill to appear in court has not yet been scheduled. The mail fraud and money laundering counts each carry a maximum penalty of 20 years in prison. The federal program fraud count carries a maximum penalty of 10 years in prison. The maximum fine for each count is $250,000. However, any sentence following a conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statutes.
An indictment is an accusation only. A defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.