San Angelo Family Members Sentenced in Structuring Case
Husband and Wife Serving Prison Sentences; Children Receive Probation
|U.S. Attorney’s Office November 20, 2009|
LUBBOCK, TX—The last of four family members from San Angelo, Texas, who pleaded guilty in a transaction structuring case was sentenced today, announced U.S. Attorney James T. Jacks of the Northern District of Texas. Jimmy Lee Hughes, who pleaded guilty in August 2009, to one count of misprision of a felony, was sentenced this morning by U.S. District Judge Sam R. Cummings to three years’ probation and ordered to pay a $5000 fine. His sister, Alma Faye Hallmark, pleaded guilty to the same offense and was sentenced in September to the same sentence. Misprision of a felony is concealing another’s felony offense from law enforcement.
Their father, Bobby Ray Hughes, 74, who pleaded guilty to conspiracy to structure transactions to avoid reporting requirements and was sentenced in September, is currently serving his 24-month sentence at the Federal Correctional Institute in La Tuna, Texas. He was also ordered to pay a $40,000 fine. His wife, Shirely K. Hughes, 71, pleaded guilty to a misprision of a felony and is currently serving her six-month sentence at the Federal Correctional Institute in Fort Worth, Texas. She was also ordered to pay a $5000 fine.
Bobby Ray and Jimmy Lee Hughes were equal partners in the ownership of H & H Land Development. That partnership also conducted business under the names of Bob Hughes Oil Co., Hughes Pipe and Supply, and H & H Pipe & Supply, which bought and sold pipe and oil field equipment. Alma Faye Hallmark worked as a paid employee of H & H Land Development, performing administrative and bookkeeping duties. Shirley K. Hughes was involved in the daily banking activity of the partnership and, on a monthly basis, provided business records, including bank statements, to their Certified Public Accountants (CPAs) to prepare their business and personal income tax returns.
The Bank Secrecy Act requires that specific reports be filed with the government by a financial institution and that the financial institution maintain these records. A financial institution must file a Currency Transaction Report (CTR) for each deposit, withdrawal, exchange of currency, or other payment or transfer that involves more than $10,000. The financial institution in San Angelo that the family used required its tellers to obtain Bank Secrecy Act information, specifically social security numbers, from customers conducting cash transactions in excess of $3000.
In order to avoid these reporting requirements, Shirley Hughes converted numerous third-party checks, made payable to her husband or the business, to bank cashiers’ checks, rather than depositing the checks into one of their bank accounts. By doing this, the receipt of those monies wasn’t reflected in the Hughes family bank statements which a CPA firm used to prepare their business and personal federal tax returns. Instead of depositing checks that were made payable to her husband or the business, and endorsed by her husband, Shirley K. Hughes would instead purchase multiple lesser-denominated cashier’s checks that were made payable to a Hughes family member and subsequently cashed by a Hughes family member.
The case was investigated by the FBI and Internal Revenue Service - Criminal Investigation and was prosecuted by Assistant U.S. Attorneys Ann C. Roberts and Jeffrey Haag of the Lubbock, Texas, U.S. Attorney’s Office.