a FTLED tN OPEN COURT

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MEM N()1/ 23 2011

IN THE UNITED STATES DISTRICT COURCHARLES R. DIARD, JR.FOR THE SOUTHERN DISTRICT OF ALABAMA CLERK

SOUTHERN DIVISION

UNITED STATES OF AMERICA

v.

* CRIMINAL NO. 11.00262?L

* usAo No.11R00091&

STANLEY MARSHALL wRrcHT * violations: 18 usc g 371MARY L. WRIGHT aka * 18 USC g 2

MARY W. STRACHAN aka * 18 USC g 666MARY W. COOK and 'r t8 USC g 1956(a)(1)

JANEY GALBRAITH 'r 18 USC g 1513(e)* 18 USC $ 134918 USC $ 1343

SUPERSEDING INDICTMENT

THE GRAND JURY CHARGES:

INTRODUCTION

At all times relevant to the indictment:

1. Bayou LaBatrewas a municipality located in Mobile County, in the Southern

District of Alabama.

2. STANLEY MARSHALL WRIGHT was Mayor of Bayou La Batre.

3. MARY L. wRrcrrr aka MARY w. STRACHAN aka MARy w. cooK was

the daughter of STANLEY MARSHALL WRIGHT.

4. JANEY GALBRAITH was hired to assist Bayou La Batre in applying for grants

from federal agencies and then hired to administrate the grants.

5. Alabama statute S 134-10-62 requires a public servant to disclose a conflict of

interest if he exercises any substantial discretionary function in connection with a government

contract, purchase, payment or other pecuniary transaction. According to the statute, a potential

conflict of interest exists when the public servant owns directly or indirectly a substantial portion

of any non-govemment entity participating in the transaction

6. The FEMA Grant Agreement contains the terms and conditions required by FEMA

to award 515,667,293.00 to the City of Bayou La Batre. The terms of the grant agreement

required the Grantee to comply with all applicable laws and regulation including 44 CFR

13.36(bX3) which states that "No employee, officer or agent of the grantee or subgrantee shall

participate in selection, or in the award or administration of a contract supported by Federal funds

if a conflict of interest,real or apparent, would be involved.

According to the regulation, such a conflict would arise when:

A. The employee, officer or agent;B. Any member of his immediate family;C. His or her partner, orD. Anorganization which employs, or is about to employ, any of the above,

has a financial or other interest in the firm selected for award.

Alabama Statute $ 134-10-62 requires a public servant to disclose a conflict of interest

if he exercises any substantial discretionary function in connection with a govemment contract,

purchase, payrnent or other pecuniary transaction. According to the statute, a potential conflict

of interest exists when the public servant owns directly or ind.irectly a substantial portion of any

non-govefilment entity participating in the transaction.

The FEMA Grant Agreement was signed by STANLEY MARSHALL WRIGHT,

acting as Mayor of Bayou LaBatre, on August 20,2007.

COUNT ONE

From on or about Jwre 2007 and continuing through and including the date of this

indictment, the exact dates being to the Grand Jury unknown, in the Southern District of

Alabama and elsewhere.

STANLEY MARSHALL WRIGHT andMARY L. WRIGHT aka MARY W. STRACHAN aka MARY W. COOK and

JANEY GALBRAITH

defendants herein, did knowingly, willfully and unlawfully combine, conspire, confederate, and

agree with each other and with others, known and unknown to the Grand Jury:

(A) to defraud the United States, and

(B) to knowingly and wilfully embezzle, steal, obtain by fraud and otherwise without

authority convert to the use of a person other than the rightful owner and intentionally misapply

property valued at $5,000.00 or more from Bayou La Batre which in the year of 2007, received

more than $10,000.00 from FEMA, in violation of Title 18, United States Code, Sections

666(aX1XA) and2.

BACKGROUND

Bayou La Batre applied for a grant for funds from approximately $400 million

appropriated by Congress and intended, inpart, to fund a pilot program to identify, implement,

and evaluate alternatives to the Federal Emergency Management Agency's (FEMA) traditional

disaster housing options for disaster survivors. The Alabama Alternative Housing Pilot Program

(AAHP) was part of the appropriation and was intended to fund permanent housing solutions

rather than FEMA's traditional response of providing funding for temporary housing for disaster

vlctrms.

Bayou LaBatresubmitted a grarftapplication, prepared by JANEY GALBRAITH,

which primarily focused on transitioning families directly from post-storm FEMA trailers to

permanent housing to be built with the grant funds.

On June 27 ,2007 , FEMA entered into a Grant Agreement with the City of Bayou La

Batre. The Grant Agreement was signed by STANLEY MARSHALL WRIGHT, Mayor of

Bayou LaBatre, on August 20,2007.

FEMA provided the grant funding directly to the City of Bayou La Batre. Expenditures

for this grant could be approved with only the signature of the Mayor, along with the signatures

of two City Council members.

The AAHP housing development was a two-part development called Safe Harbor Estates

and Safe Harbor Landing. The original proposal submitted by the City inctuded plans for the

construction of 194 housing units. However, during the course of the project, the number of

units was scaled back and only 100 housing units were actually produced. These homes are

factory-built modular units varying in size from 820 to 1360 square feet.

After the project was under construction, the City of Bayou La Batre determined that it

was necessary to purchase two small tracts of additional land to widen the entrance to the

AAHPP development. One of the two small tracts of land that was selected for prrchase by the

City of Bayou La Batre was part of a larger parcel that was owned by Mayor STANLEY

MARSHALL WRIGHT. Mayor STANLEY MARSHALL WRIGHT had purchased this

parcel of approximately 7.5 acres of landin 1997 for a total purchase price of $29,000.00.

On October 16,2007, Mayor STANLEY MARSHALL WRIGHT transferred

ownership of aparcel of 0.208 acres out of the larger 7.5 acres parcel to his daughter, MARY L.

WRIGHT aka MARY W. STRACHAN aka MARY W. COOK for no financial

consideration.

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On October 24,2007, MARY L. WRIGHT aka MARY W. STRACHAN aka MARY

W. COOK transferred the same parcel of 0.208 acres to the City of Bayou LaBatre.

On December 13, 2007,Bayou La Batre paid MARY L. WRIGHT aka MARY W.

STRACHAN aka MARY W. COOK $27.249.00 for the 0.208 acres in the form of a check

drawn on Regions Bank on an account owned by the City of Bayou La Batre andtitled "FEMA

AHPP Grant" with the aceount number endins in 1176. The check had amemo notation of

"Purchase right-of-way. "

On December 17.2007 " MARY L. WRIGIIT aka MARY W. STRACHAN aka

MARY W. COOK wrote three checks payable to STANLEY MARSHALL WRIGHT and one

check to STANLEY MARSHALL WRIGHT',s wife. These four checks totaled $27.300.00

and were each deposited into an account owned by STANLEY MARSHALL WRIGHT and his

wife.

OVERT ACTS

In furtherance of the aforementioned conspiracy and in order to effect the objects thereof,

the following overt acts, among others, were committed by the defendants in the Southern

District of Alabama and elsewhere:

1. On October 16,2A07, Mayor STANLEY MARSHALL WRIGHT transferred

ownership of aparcel of 0.208 acres to his daughter, MARY L. WRIGHT aka MARY W.

STRACHAN aka MARY W. COOK for no financial consideration.

2. On October 24.2407. MARY L. WRIGHT aka MARY W. STRACHAN aka

MARY W. COOK transferred the same parcel of 0.208 acres to the City of Bayou La Batre.

3. OnNovember 15, 2007, JANEY GALBRAITH presented a funding request to the

City Council to pay MARY W. COOK .

4 On November 15, 2007, JANEY GALBRAITH assured a concerned citv council

member tfat the transaction was legal and that the Cit5" Council should trust JANEY

GALBRAITH'S opinion.

5. on December 13,2007, MARY L. WRTGHT aka MARY w. STRACHAN aka

MARY W. COOK received $27,249.00 in the form of a check drawn on Resions Bank on an

account owned by the City of Bayou La Batre and titled "FEMA AHPP Grant" with the account

number ending in 1176. The check had a memo notation of "Purchase right-of-way."

6. on December 17,2007 , MARY L. WRTGHT aka MARY w. STRACHAN aka

MARY W. COOK wrote three checks payable to STANLEY MARSHALL WRIGHT drawn

on RBC Bank on an account owned by MARY W. STRACHAN and STANLEY MARSHALL

WRIGHT's wife with an account number ending in 0521. Check No. 714 in the amount of

$10,000.00, Check No. 715 in the amount of $10,000.00, and Check No. 716 in the amount of

$5,000 were made payable to STANLEY MARSHALL WRIGHT. Check No. 717 in the

amount of 2,300.00 was made payable to STANLEY MARSHALL WRIGHT's wife. These

four checks totaled $27.300.00.

7. OnDecember 20,2007, STANLEY MARSHALL WRIGHT deposi.ted or caused to

be deposited these four checks into an RBC Bank account owned by STANLEY MARSHALL

WRIGHT and his wife with an account number ending in 3871.

All in violation of Title 18, United States Code, Sections 37I and2.

COUNT TWO

From June2007 continuing through on or about December 3I,2007, in the Southern

District of Alabama, Southem Division and elsewhere, the defendants.

STANLEY MARSHALL WRIGHT andMARY L. WRIGHT aka MARY W. STRACHAN aka MARY W. COOK

together with others, did knowingly and willfully embezzle, steal, obtain by fraud and otherwise

without authority convert to the use of a person other than the rightful owner and intentionally

misapply property valued at $5,000.00 or more owned by and under the care, custody, and

control of City of Bayou La Batre, which received more than $10,000.00 from FEMA in2007,in

that defendants did convert to their own use monies in an amount in excess of $5.000.00 from the

Regions Bank account owned by the City of Bayou La Batre and titled "FEMA AHPP Grant"

with the account number ending in 1176.

All in violation of Titte 18, United States Code, Section 666 and2.

COTJNTS THREE THROUGH SIX

On or about December 17,2007, continuing through on or about December 20,2A07,in

the Southern District of Alabama, Southem Division and elsewhere, the defendants,

STANLEY MARSHALL WRIGHT andMARY L. WRIGHT aka MARY W. STRACHAN aka MARY W. COOK

knowingly conducted and attempted to conduct financial transactions affecting interstate

corlmerce, namely, issuing a series of checks in the amounts listed below, held in the name of

MARY W. STRACHAN and STANLEY MARSHALL WRIGHT's wife at RBC Bank on an

account number ending in}52l,which transactions involved the proceeds of a specified

unlawful activity, namely Theft from an Organization Receiving Federal Funds, in violation of

Title 18, United States Code, Section 66,6,thedefendants then knowing that the property

involved in said financial transactions represented the proceeds of some form of unlawful

activity, and engaging in said financial transactions (a) with the intent to promote the carrying on

of the specified unlawful activity; and (b) knowing that the transactions were designed in whole

or in part to conceal and disguise the nature, locaiion, source, ownership and control of the

proceeds of the specified unlawful activity, as follows:

COTINT DATE CHECK NO. AMOL]'NT

THREE t2-17-2A07 714 $10.000.00

FOUR 12-17-2007 7Is $10.000.00

FM t2-17-2007 716 $ s.000.00

sIX r2-t7-2007 717 $ 2.300.00

All in violation of Title 18, United States Code, Sections 1956(a)(1) and,2.

COUNT SEVEN

From January 2011 continuing through on and through the date of this indictment, in the

Southern District of Alabama, Southern Division and elsewhere, the defendant,

STANLEY MARSHALL WRIGHT

did knowingly, with the intent to retaliate, take an action harmful to an individual known to the

Grand Jury and identified as D.W. which was harmful to and which interfered with the lawful

employment and livelihood of D.W., for providing to a law enforcement officer truthful

information relating to the possible commission of a Federal offense.

All in violation of Title 1 8, United States Code, Section 1 5 I 3 (e).

COUNT EIGHT

From on or about June27,2006 through on or about September 30,2010, in the Southem

District of Alabama, Southern Division, and elsewhere, the defendants,

STANLEY MARSHALL WRIGHT andJANEY GALBRAITH

knowingly and willfully did cornbine, conspire, confederate , and, agreewith each other.to commit

the following offense against the United States of America, to-wit:

To devise and intend to devise a scheme and artifice to defraud and transmits and causesto be transmitted by means of wire communication in interstate and foreign commerce anywritings, signs, signals and pictures and signs for the purpose of executing such scheme andartifrce, in violation of 18 USC $ 1343.

Specifically, from-on or about June 1, 2010,though on or about September 2010, the

Department of Housing and Urban Development through their Office of the Inspector General

(HUD-OIG) conducted an audit to determine whether the State of Alabama and the City of

Bayou La Batre were administering the HUD Grant Program in accordance with the requirements

of their agreements and specifically determining whether the procedures and controls

implemented by the City of Bayou LaBatre prevented the duplication of benefits and that the

City of Bayou La Batre ensured that its payment requests were adequately supported and

expended only for eligible costs.

In order to conceal the fact that the HUD Grant Program was not administered in

accordance with the agreement and to convince HUD-OIG that they were complying with the

Grant Agreement, JANEY GALBRAITH instructed her staff to alter or omit documents which

documented a duplication of benefits. JANEY GALBRAITH then transmitted and caused to be

transmitted the fraudulent information by e-mail to HUD-OIG.

All in violation of Title 18. United States Code. Section 1349.

COUNTS NINE THROUGH ELEVEN

From on or about Jwte 27,2006 through on or about September 30,2010, in the Southern

District of Alabama, Southern Division, and elsewhere, the defendant,

JANEY GALBRAITH

knowingly and willfully devised and intended to devise a scheme and artifice to defraud the

United States by transferring false documents that contained material misrepresentations and

omissions concerning applications for Housing Assistance Grants.

Specifically, from on or about June 1, 2010, though on or about September 2010, the

Department of Housing and Urban Development through their Office of the Inspector General

(HUD-OIG) condueted an audit to determine whether the State of Alabama and the City of

Bayou La Batre were administering the HUD Grant Program in accordance with the requirements

of their agreements and specifically determining whether the procedures and controls

implemented by the City of Bayou La Batre prevented the duplication of benefits and that the

City of Bayou La Batre ensured that its paynent requests were adequately supported and

expended only for eligible costs.

In order to conceal the fact that the HUD Grant Program was not administered in

accordance with the agreement and to convince HUD-OIG that they were complying with the

Grant Agreement, JANEY GALBRAITH instructed her staff to alter or omit documents which

documented a duplication of benefits. JANEY GALBRAITH then transmitted and caused to be

transmitted the fraudulent information by e-mail to HUD-OIG.

On or about each of the dates set forth below. in the Southern District of Alabama and

elsewhere. defendant.

JANEY GALBRAITH

for the purpose of executing the scheme described above, and attempting to do so, caused to be

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transmitted by means of wire communication in interstate commerce from the Southern District

of Alabama to Mississippi, the signals and sounds described below for each count, each

transmission constituting a separate count:

COUNT

9

DATE

8-24-10

8-24-1010

DESCRIPTION

E-mail transmission from Janey Galbraith akagrantslady@msn.com to Kimberly Sandifer akaKmichael-S andifer@hudoi g. gov identifi ed bySubject Lite"#l of 5 more Duplication ofBenefits Files" aniJ- attaching Charles LaForce.pdf

E-mail transmission from Janey Galbraith akagrantslady@msn.com to Kimberly Sandifer akaKmichael-Sandifer@hudoig. gov identified bySubject Line"#l of 5 more Duplication ofB enefits File s " artd attaching Chandra Kim. pdf

11 8-20-10 E-mail transmission from Janey Galbraith akagrantslad)'@msn.com to Kimberly Sandifer akaKmichael- Sandifer@hudoi g. gov identifi ed bySubject line and attaching Allen LaForce.pdf

A11 in violation of Title 18 of the United States Code" Sections 1343 and 1349.

FgRFEITURE NOTICE

The allegations of Counts Three through Six are hereby realleged and incorporated by

reference for the purposes of alleging forfeitures pursuant to provisions of Title 18, United States

Code, Section 982 (a) (1).

Upon conviction of the aforesaid violations of Title 18, United States Code, Sections

1956 (a) (1), defendants STANLEY MARSHALL WRIGHT and MARY L. WRIGHT aka

MARY W. STRACHAN aka MARY W. COOK shall forfeit to the United States any right,

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title, and interest they may have in any property, real or personal, wherever located and in

whatever rutmes held, involved in said violation, or any property traceable to such property,

pursuant to Title 18, United States Code, Section 9S2 (a) (1).

Such forfeiture shall include, but is not limited to the following property:

(A) $27,249.00

A TRUE BILL

f-offireo $hArrs cnaNp runySOUTHERN DISTzuCT OF ALABAMA

KENYEN R. BROWNUNITED STATES ATTORNEYBy:

z_Maria E.Assistant

MurphyUnited States Attorney

NOVEMBER 2011Chief. Criminal Divrsron

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