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Former mayor of metro Atlanta city pleads guilty to fraud

Former mayor of metro Atlanta city pleads guilty to fraud
Photo credit: / Joseph Sohm

ATLANTA – Jason Lary, the former mayor of Stonecrest, and Lania Boone, a bookkeeper for the entity that administered COVID-19 relief funds awarded to Stonecrest, have pleaded guilty to charges related to the theft of pandemic relief funds.

Former mayor of metro Atlanta city pleads guilty to fraud
Jason Lary
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“Lary’s guilty plea was the first in righting the wrongs committed against the people of Stonecrest, who were wrongfully deprived of hundreds of thousands of dollars intended to provide COVID-19 relief,” said U.S. Attorney Kurt R. Erskine. “Boone’s guilty plea further demonstrates our commitment to prosecuting those who seek to exploit COVID relief programs for their own gain.”

“CARES Act funds were intended to help people and businesses harmed by the pandemic, not to line the pockets of public officials entrusted to lead a community,” said Philip Wislar, Acting Special Agent in Charge of FBI Atlanta. “The FBI will do everything in our power to make sure stolen funds are returned to the public, and individuals involved in this type of criminal behavior are prosecuted to the fullest extent of the law.”

According to U.S. Attorney Erskine, the charges, and other information presented in court: the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act was passed in March 2020 to respond to the economic fallout of the COVID-19 pandemic.  Under the CARES Act, the federal government distributed $125 million in COVID-19 relief funds to DeKalb County. The federal government permitted DeKalb County to further disburse these relief funds to its municipalities. In July 2020, the DeKalb County Board of Commissioners voted to disburse some of the relief funds to its municipalities, including a $6.2 million grant to Stonecrest.

Stonecrest was required to spend the relief funds in accordance with the CARES Act. In general, according to the Department of the Treasury, relief funds could “only be used to cover costs that — [were] necessary expenditures incurred due to the public health emergency . . . . and were incurred during the period that [began] on March 1, 2020, and [ended] on December 30, 2020.”  Eligible expenditures included medical expenses, public health expenses, and grants to small businesses to reimburse the costs of business interruption caused by required closures.

In September 2020, Lary, as mayor, signed a resolution acknowledging the CARES Act requirements and adopting a funding plan for Stonecrest’s relief funds. The plan provided $1 million to the Stonecrest Cares Program for mask distribution, COVID-19 education and testing, and other purposes. In practice, the Stonecrest Cares Program directed relief funds to churches and non-profit organizations in and around Stonecrest.  The plan also provided $5 million to the COVID-19 CARES Act Small Business Program (“Small Business Program”).

Stonecrest did not disburse the $6 million allocated to the Stonecrest Cares Program and Small Business Program.  Instead, the city contracted with Municipal Resource Partners Corporation, Inc. (“MRPC”) to provide accounting services and to disburse the relief funds as directed by Stonecrest.  Before the contract was signed, Lary worked behind the scenes to form MRPC, recruit its CEO, open its bank accounts, and ensure that Lania Boone would be hired as MRPC’s bookkeeper.

In or about November 2020, Stonecrest published an application on its website for businesses to apply for relief funds under the Small Business Program.  The application included the question, “are you willing to allocate 25% of your grant to marketing your business?”  Hundreds of businesses applied for relief funds, but most of the applicants were rejected.  From about November 2020, until in or about February 2021, Boone signed dozens of checks on behalf of MRPC, directing millions of dollars of relief funds to individuals, businesses, churches, and non-profit organizations.  Lary helped decide where the relief funds were directed.

Abusing the authority conferred on him as mayor, Lary devised and executed a scheme to steal relief funds after they were distributed by MRPC. First, Lary told churches that received relief funds under the Stonecrest Cares Program that they were required to contribute a portion of those funds for purposes identified by Lary.

For example, Lary presented a check for $150,000 in relief funds to “Church 1,” on the condition that $50,000 be given to a company called Real Estate Management Consultants, LLC (“REMC”). Lary did not tell Church 1 at this time that he actually controlled REMC. Lary falsely stated that the $50,000 would be used to assist with home repairs for people who could not afford them due to COVID-19.  In reality, Lary used the money for his own purposes, including to pay off his outstanding federal, state and local tax liabilities.

As another example, Lary presented a check from MRPC for $50,000 to “Church 2.” Later, a person acting on Lary’s behalf told Church 2 to contribute $4,500 of the relief funds to REMC, purportedly for rent assistance. Lary spent the money to pay his own property expenses and his dues to the Georgia Campaign Finance Committee.

In addition, Lary solicited relief funds from businesses that received grants under the Small Business Program. Lary falsely claimed that the money would be each business’s “contribution” to Stonecrest-related marketing and advertising.  But Lary and others asked that these “contributions” be given not to Stonecrest, but  to entities called Visit Us, Inc. and Battleground Media, LLC.  Lary did not tell the businesses that he controlled these entities.

In total, businesses were defrauded out of hundreds of thousands of dollars of relief funds. Lary used the relief funds deposited into the Visit Us and Battleground Media accounts to benefit himself and others. For example, Lary used relief funds held by Visit Us to pay for an associate’s political advertising.

Finally, Lary conspired with Boone, MRPC’s bookkeeper, to steal relief funds before they were disbursed by MRPC. In January 2021, Boone used her access to one of MRPC’s bank accounts to wire transfer approximately $108,000 of relief funds to a mortgage servicing company. Lary and Boone knew the purpose of the transfer was to pay off the mortgage on a lakefront home owned by Lary. Around the same time, Lary directed approximately $7,600 in stolen relief funds to be paid by Visit Us for Boone’s son’s college tuition and rent.

Jason Lary, 59, of Stonecrest, Georgia, is scheduled to be sentenced on May 2, 2022, at 10 a.m. Lania Boone, 60, of Decatur, Georgia, pleaded guilty today to conspiracy to commit federal program theft and is scheduled to be sentenced on May 12, 2022, at 2:00 p.m.

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