Local business partners Jabari Edwards and Antwann Richardson have been indicted by a federal grand jury for multiple charges related to misusing more than $2 million in Paycheck Protection Plan and Economic Injury Disaster Loan Program funding.
The indictment was filed in the U.S. District Court for the Northern District of Mississippi on Wednesday. The Federal Bureau of Investigation, the Lowndes County Sheriff’s Office and other agencies raided J5’s office at Court Square Towers on Second Avenue North on Thursday morning.
According to the indictment, Edwards and Richardson are each charged with one count of conspiracy to commit wire fraud, three counts of wire fraud and seven counts of money laundering. Edwards also is charged with two counts of making false statements.
The two received the PPP funds through Bank of Vernon, the indictment states. The EIDL loan applications were submitted directly to the Small Business Administration.
The indictment alleges that beginning around Jan. 10, 2021, through about Jan. 25, 2022, Edwards and Richardson filed “false and fraudulent PPP and EIDL applications and agreements on behalf of North Atlantic Security … by falsely agreeing to use the funds for payroll expenses or other working capital for NAS.”
That money was used for, among other things, “… the purchase of Court Square Towers, personal real estate transactions, political contributions, charitable donations, loan payments for vehicles, and lump sum payments to friends, families and employees of their other companies.”
Edwards allegedly filed an application for $567,522 in PPP funds on behalf of NAS, claiming the business had “85 employees and a total monthly payroll of $227,009 when NAS’s monthly payroll was approximately half that amount.”
When Edwards filed the application, “… Edwards and Richardson had already agreed to sell NAS’s assets and contracts to American Sentry Security Services.”
American Sentry Security Services, according to the indictment, is owned by Jim Bell and Christine Steadman. Edwards does not have any remaining ownership interest in the company.
The PPP money was transferred to Edwards on Jan. 22, 2021, according to the indictment. On March 4, 2021, American Sentry bought NAS. Richardson signed the contract on behalf of NAS, and NAS “ceased to do business as a security company and has not performed any business since March 4, 2021.”
None of the PPP money was given to American Sentry, the indictment alleges.
The indictment details a host of financial transactions showing that the PPP money was divided up, some going to J5, some to Edwards’ personal bank account and some to The Bridge Group, an insurance agency Edwards owns.
Edwards allegedly went back to the well again in October 2021, months after selling NAS, when he “submitted a false and misleading EIDL loan modification agreement” requesting more money. On the loan application he said that NAS was still operating as a company, and he later received an additional $350,000.
That money also was siphoned to J5, where some of it was donated to Jackson State University and some of it was used to pay state and federal income taxes, according to the indictment.
Edwards allegedly submitted another loan modification for NAS in November 2021, receiving a further $1.5 million. The indictment states that money went to Edwards Enterprises, and from there to J5; to BH Properties, a company listing Edwards as its sole member and Richardson as its manager; to Build Development Group; and to The Bridge Group.
Edwards wrote checks of various amounts, including one for $30,000 to Richardson, to several individuals and included “I love you” in the memo line, according to the indictment. Others receiving such checks were Snata Blakney ($20,000), Sophia Erby ($20,000) and Jewel Edwards ($12,000).
On Jan. 25, 2022, Edwards bought Court Square Towers, the indictment states, for $1.2 million.
Conspiracy to commit wire fraud and wire fraud both carry a maximum sentence of up to 30 years and up to a $1 million fine. False statement carries a maximum sentence of five years and up to a $250,000 fine. Money laundering carries a maximum sentence of up to 10 years in prison and a fine of not more than twice the amount of criminally derived property.
Edwards serves on the Mississippi Business Finance Corporation Board, which is responsible for administering incentive programs to assist businesses in obtaining development/expansion loans.
Brian Jones is the local government reporter for Columbus and Lowndes County.
