Friday, May 2, 2008

Lexington Herald-Leader: Five Indicted on Mail Fraud Charges

From the Lexington Herald-Leader:

  • "Five Kentuckians -- including the owner of a Whitesburg insurance company and two of its employees -- were indicted Thursday on mail fraud charges. The indictment alleges that the group devised a scheme from 2003 to 2005 to defraud Kentucky Employers' Mutual Insurance in Lexington of workers' compensation insurance premiums by misrepresenting the number of employees and payroll of ZAG Resources Inc."

Those indicted:

  • John and his wife Tena Pennington of Stanton
  • CS&W Insurance Company owner Thomas Childers, who lives in Hazard
  • Karen Lynetta Fox-Burns and Shannon Ranee Hogg of Whitesburg, both employees of CS&W Insurance Co.

According to the Herald-Leader: "The indictment alleges that John Pennington failed to pay federal taxes to the Internal Revenue Service that he withheld from his employees' wages from 2003 to 2007. A court date for the five has not been set."

This appears to be a MAJOR case of fraud...we'll hear more about this case in the weeks and months to come.

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