HATTIESBURG -- Former D'Iberville City Manager Michael Janus admitted in federal court Monday afternoon that he committed fraud against the government when he secured an unearned "finder's fee" for business partner Scott Walker, then shared the proceeds.
Janus acknowledged that he tried to cover up the $180,000 "finder's fee" D'Iberville paid Walker in December 2011 by having a legitimate vendor submit the invoice for payment. The vendor, Chris Gouras of consulting firm Gouras & Associates, refused, Assistant U.S. Attorney Jerry Rush said during the plea hearing.
Walker, who then billed the city, deposited half the money in the account of a business that he and Janus owned, Janus admitted. Further, Janus acknowledged, Walker did nothing to earn the money,
In exchange for his guilty plea to one count of fraud, the U.S. Attorney's Office has agreed to drop four other criminal charges against Janus. Janus has agreed to testify against Walker at the trial scheduled to start on March 10. The fraud conviction carries a maximum sentence of 10 years in prison, but the sentence prosecutors are recommending remains under seal. Judge Keith Starrett is not bound to follow prosecutors' recommendation when he sentences Janus on May 6.
Assistant U.S. Attorney John Dowdy, who heads the Southern District's criminal division, said outside the courtroom, "I don't think it would be appropriate for me to comment, except to say we do expect (Janus) to testify at trial."
Walker faces the same five charges filed against Janus: conspiracy, fraud, bribery and two counts of money laundering.
Janus, who wore a dark suit, stood with hands clasped in front of him through most of the 40-minute hearing. He answered Starrett's questions in a clear, unemotional voice. He was accompanied to court by his attorney, Cliff Johnson of Jackson.
Assistant U.S. Attorney Jerry Rushing, who is prosecuting the case, laid out for Starrett the facts the government believes it can prove at trial. Janus agreed the government's case against him is true.
Rushing said the city of D'Iberville signed a consulting agreement with the Gouras firm in January 2011. Janus asked Gouras in March if he would help Walker secure grant funds for the city. Gouras said he would, but then his firm had no role in landing a $3 million grant through the state for city work to support a proposed aquarium, Ocean Expo.
Janus announced the grant award at a November 2011 council meeting, Rushing said, thanking Gouras for his work. After Gouras refused to submit an invoice for $180,000 and give Walker 80 percent, Rushing said, Walker submitted the invoice.
A contract between the city and Maxwell Walker, Scott Walker's firm, was back-dated to January 2011, Rushing said, but was ac
tually executed in December 2011.
The city paid Walker's consulting firm its "finder's fee" the same month. Officials from the governor's office and the state Department of Environmental Quality, which administered the grant, would testify that Walker and his consulting firm had nothing to do with securing the funds, Rushing said.
Rushing said Walker deposited $90,000 of the "finder's fee" into the account of JaWa Investments, owned by Walker and Janus. JaWa wrote a $40,000 check to "D.R.," who was not further identified, to repay a loan. The loan, Rushing said, was for an interest in The Columns bar in downtown Biloxi.
Janus admitted to Federal Bureau of Investigation agents more than a year ago that he and Walker had planned all along to transfer money from Walker's "finder's fee" to the JaWa account to repay loans.
"Janus admitted that he knew it was wrong for him to receive the monetary benefit," the government said.
Walker's attorneys, Arthur Madden and Corban Gunn, sat silently through the hearing, which Walker did not attend.
"I just wanted to see how it went down," said Madden, who is from Mobile. "And now I know."
Walker also faces felony charges in a second public corruption case along with his father, former state Department of Marine Resources Director Bill Walker, and two other former DMR managers.
After the plea hearing, Janus and his attorney left the courthouse through separate doors, allowing Janus to avoid the media. Johnson, who is from Jackson, said, "It's been a long, hard day."