Tennessee Department of Transportation Contractor Forfeits Assets Exceeding $500,000
Embezzlement Scheme Discovered in Right-of-Way Acquisitions
|U.S. Attorney’s Office October 15, 2012|
Michael Wayne Young, 53, of Fairview, Tennessee, a TDOT consultant and contractor, has agreed to forfeit more than $500,000 in assets derived from an embezzlement scheme while working as a contractor for the Right-of-Way Division of the Tennessee Department of Transportation (TDOT), announced Jerry E. Martin, U.S. Attorney for the Middle District of Tennessee.
Young is the president of Capitol Consultants Inc., aka Capitol Abstract and Title (Capitol) and is a TDOT “right-of-way” division consultant/contractor responsible for purchasing real property for TDOT.
The embezzlement was discovered in early 2012 when auditors working for TDOT began examining aging right-of-way projects—specifically, the purchase of properties that should have been closed years earlier but were not. TDOT auditors discovered nine parcels of real property for which TDOT had provided funds to Capitol for the sole purpose of purchasing these properties and for which the closings were still pending. The state of Tennessee’s check for each of these properties had been negotiated; however, the real estate closings had not occurred and the properties had not been deeded to the state of Tennessee.
Auditors determined the total amount of funds paid by TDOT to Capitol for the acquisition of the nine parcels was approximately $318,781.00. Auditors sought a complete accounting from Capitol of all right-of-way projects and determined that Capitol had received checks for the purchase of an additional 45 parcels of real property that have yet to be closed.
During a meeting with TDOT’s Internal Audit Division on August 30, 2012, Young admitted to embezzling funds intended for the acquisition of real property for TDOT and converting them to his own use.
Michael Wayne Young has entered into a settlement agreement and mutual release with the United States in his personal capacity and in his capacity as owner of Capitol Consultants Inc. in which he has admitted misappropriating funds from the state of Tennessee Right-of-Way program in an amount exceeding $500,000 and has agreed that certain bank accounts and real property are subject to restoration to the state of Tennessee and forfeitable to the United States.
This investigation was conducted by the Internal Audit Division of the Tennessee-Department of Transportation, the United States Department of Transportation-Office of Inspector General, and the IRS- Criminal Investigation, with assistance from the FBI. The government is represented by Assistant U.S. Attorney Debra Teufel Phillips.