Defendants Sentenced to Federal Prison for AEP Power Surge Scam
|U.S. Attorney’s Office October 03, 2012|
CHARLESTON, WV—U.S. Attorney Booth Goodwin announced that two defendants were sentenced yesterday (October 2) to federal prison for submitting fraudulent claims for power surge damage to American Electric Power Service Corporation Inc. (AEP). Mark Ingram, 42, of Nitro, was sentenced to one year and one day in prison and Karen Hodges, 32 both of Nitro, West Virginia, was also sentenced to one year and one day in prison. A third defendant, Crystal Ingram, 32 of Nitro, West Virginia, was sentenced to five years’ probation and eight months of home confinement as a condition of her probation.
The defendants admitted that they conspired with former AEP property damage claims adjuster Deborah Farmer, 47, to unlawfully obtain money from AEP by submitting fraudulent claims for power surge damage. A two-year investigation revealed that false claims were filed with AEP related to power surge damage to homes. Mr. Ingram and Mrs. Ingram each admitted that they joined the conspiracy to commit mail fraud when they filed fraudulent claims and received the fraudulent checks through the mail. The defendants then cashed the checks, took a portion of the payoff, and gave the remaining proceeds back to Ms. Farmer or other defendants. Claims checks, ranging from $2,000 to as much as $25,000 per fraudulent claim, were mailed to several known individuals, including Hodges, at various times between March 2009 and March 2010.
Farmer was sentenced to three years in prison in August.
A total of 57 fraudulent claims were filed resulting in a loss to AEP of approximately $598,485.
The court ordered Mark Ingram to pay $52,792 in restitution; Crystal Ingram to pay $69,966 in restitution; and Karen Hodges to pay $37,099 in restitution.
The Federal Bureau of Investigation (FBI), United States Postal Inspection Service, and West Virginia State Police handled the investigation. Assistant United States Attorney Erik S. Goes handled the prosecution. The sentences were imposed by United States District Judge John T. Copenhaver, Jr.