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Feb 15 2012

Hughes citizens get no answers on fraud investigation

WREG-TV 803 Channel 3 (Tennessee) - by Natasha Chen

About 50 Hughes residents packed a monthly town hall meeting, hoping to find out about a federal investigation possibly involving the mayor. Instead, the topic was not brought up at all, since it was not on the agenda. The mayor, Larry Owens, told News Channel 3 he was not the subject of an investigation at all.

Owens also denied any business with Life Options of Eastern Arkansas, the non-profit under scrutiny. He would not comment further, even though his wife, Sheryl Owens, is listed as the incorporator/organizer under the Arkansas Secretary of State’s filing for this corporation.

A former Life Options employee has told News Channel 3 that a whistleblower complained to authorities of misuse of U.S. Department of Agriculture funds, profiting off of federal funds, and using a ghost payroll system.

The current chairman of the Life Options board and the CEO of Life Options both confirmed the USDA and FBI are conducting an investigation and that they have been in contact with federal agents.

The FBI did not confirm nor deny an investigation in this case. The USDA is currently working on a response to News Channel 3's questions.

Life Options provides financial planning and grant-writing assistance to impoverished farmers in surrounding rural areas. For this work, Life Options also receives federal grant money to operate.

Mayor Owens did not address the issue during Monday night’s meeting, but said afterward, “So far as I know, I'm not the point of any investigation.”

He described improvements he’s made in Hughes since becoming mayor, and said, “I go out and partner with folks who are going to impact sustainable actions that's going to be for the positive betterment of mankind. I'm not some kind of demon or something. So let's get that straight.”

Owens suggested having the city enlist the services of Life Options. In the last two years, a council member confirmed the only thing Life Options has achieved is a grant for a police car and a community garden.

Mary Allison was one of many concerned citizens hoping to learn more.

“When you see that the FBI is being mentioned, and of course, that automatically gets your attention. I'm not saying either way, guilty or innocent. But it warrants some attention when you see the letters FBI,” Allison said.

She mentioned other concerns having to do with city funding, but ultimately just wanted a way to improve the situation.

“We want to all work together to try to resolve this problem, and hope for the best for everyone involved,” she said.

Skeptics remained critical, however.

L.E. Vanderford, who has lived in Hughes for 56 years, said the investigation is not a surprise to him.

“I strongly suspected that would catch up with him,” Vanderford said. “He's running around, running his mouth telling everybody that all he's got to do is go to Washington to get all this money he wants to get. That he can just go up there, turn the key, and get whatever he needs.”

Still, supporters of Owens stand by his side.

Former city council member Irene Combs said that she worked with Owens on the council before he became mayor.

“I don't believe he has initiated anything, or he is involved in anything underhanded or crooked,” she said.

Combs said she believes someone has concocted the allegations to stir something up.

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