Former Mississippi Department of Marine Resources Director Bill Walker and his son, once a candidate for Ocean Springs mayor, admit they conspired to defraud the federal government of $210,000 for their own financial benefit.
Scott Walker is expected to plead guilty to the charge this morning in Hattiesburg before U.S. District Judge Keith Starrett. In a separate case, he plans to admit he defrauded the government of $180,000, along with his co-defendant, former D'Iberville City Manager Michael Janus. Janus pleaded guilty to the same fraud charge Feb. 10 and agreed to testify against Scott Walker if he went to trial.
Scott Walker's attorney, Arthur Madden of Mobile, said Wednesday afternoon: "Scott Walker has had a tough time, from the time of his airplane accident in 2011 up to the present. The decision he made to plead guilty was not made lightly. But, in light of my understanding of the facts and his considerations of his family responsibilities and his health, the decision to plead guilty was made.
"He accepts responsibility for his actions and looks forward to turning over a new chapter in his life."
Walker is still in physical therapy for a broken back he suffered when he was a passenger in a small airplane that crashed on takeoff from the Ocean Springs Airport in 2011, Madden said. The defense attorney also said Walker and his wife, Trinity Ryals Walker, are expecting the birth of their second son any day.
Assistant U.S. Attorney John Dowdy, who heads the criminal division of Mississippi's Southern District, plans to be in court for Scott Walker's plea.
"I think it would be inappropriate for us to comment until such time as the defendants have in fact pleaded guilty," Dowdy said. "If in
fact, they plead guilty, we'll be in a position where we comment more."
Bill Walker, once a trusted scientific adviser to state leaders on Coast environmental issues, is scheduled to enter his guilty plea March 10 to the conspiracy charge.
If they follow through with guilty pleas, the Walkers would face up to five years each on the conspiracy charge and Scott Walker would face up to 10 years on the fraud charge.
However, they would be unlikely under federal sentencing guidelines to receive the maximum sentences because neither has a criminal record. Sentencing guidelines also account for whether a defendant accepts responsibility for his or her crime. Prosecutors could recommend sentences as part of the Walkers' plea agreements.
Starrett is not bound by the sentencing guidelines or prosecutors' recommendations.
"Ultimately," Dowdy said, "it's the decision of the judge to determine what sentence is appropriate based on the conduct of the defendant."
In exchange for the guilty pleas, the U.S. Attorney's Office is expected to drop four other charges against Bill Walker and eight charges in the two separate cases against Scott Walker. The other charges Bill and Scott Walker face together are fraud, allegedly committed in 2011 with former DMR manager Tina Shumate; and conspiracy to commit mail fraud and two counts of mail fraud, allegedly committed from November 2006 to July 2013 with former DMR Chief of Staff Joe Ziegler.
Scott Walker was also charged, along with Janus, with conspiracy, bribery and two counts of money laundering allegedly committed from March 2011 through December 2011.
Ziegler and Shumate maintain their innocence in the case that includes both Walkers, which is set for trial June 2.
"I think this puts us in a better position," said Shumate's attorney, Tim Holleman of Gulfport. "Hopefully, the truth will come out." Holleman had filed a motion for Tina Shumate to be tried separately from the Walkers and Ziegler, but it was denied.
"If we're just dealing with what Tina Shumate did," Holleman said. "I feel much more comfortable in proceeding to trial."
Joe Sam Owen of Gulfport, Ziegler's attorney, said, "The anticipated pleas by Bill Walker and Scott Walker will not alter Joe Ziegler's position in this case." Ziegler's motion for a separate trial, filed before the Walkers announced their intention to plead guilty, is pending.
Position of trust
Bill Walker's attorney, William Kirksey of Jackson, did not want to comment on the case, an assistant said Wednesday.
Bill Walker headed the state agency charged with conserving coastal resources from 2002 until the Commission on Marine Resources fired him in January 2013. The Walkers, Shumate, Ziegler and Janus were indicted in November. Other DMR employees, indicted at the same time, face state charges from an investigation headed by Auditor Stacey Pickering's office.
The federal case against the Walkers outlines two schemes that allegedly enriched the father and son.
The Walkers and former DMR manager Shumate are accused of conspiring to defraud the federal government by transferring $210,000 from DMR accounts to the Land Trust for the Mississippi Coastal Plain to buy waterfront property Scott Walker owned in Jackson County's Gulf Hills subdivision. The indictment says both Walkers had a financial interest in the property.
The indictment says the Walkers and Ziegler diverted money intended for the state to Bill Walker's private Mississippi Marine Resources Foundation, organized about two years after Walker became DMR director.
In 2006, according to the federal charges, Bill Walker and Ziegler should have given the state $200,000 from the Southern Shrimp Alliance but the check was instead made out to the foundation. In 2009, Bill Walker is accused of accepting a donated oil rig on behalf of the DMR and having a $115,162 check for rig maintenance made out to the foundation.
The indictment outlines numerous ways foundation money personally benefited the Walkers.
In March 2010, the indictment says, Bill Walker sent a check from his foundation to American Express for $6,671. The same month, Scott Walker signed for delivery of furniture to his Ocean Springs home, according to the charges.
In July, the indictment says, Bill Walker wrote a foundation check for $13,981 to a law firm.
The JaWa connection
The federal case against Scott Walker and Janus outlines a conspiracy that allegedly benefitted the two men and a company they own together, JaWa Investments LLC. As city manager, Janus in December 2011 arranged a $180,000 "finder's fee" to Maxwell & Walker Consulting Group for a $3 million grant Walker purportedly landed for the city to support the proposed Ocean Expo aquarium.
During the Janus plea hearing, Assistant U.S. Attorney Jerry Rushing said the federal government could have proven at trial that Walker deposited $90,000 of the fee into a JaWa account. Walker and Janus used $40,000 to pay off a loan for an interest in The Columns bar in downtown Biloxi, Rushing said.
Janus is scheduled to be sentenced May 6. The fraud charge carries a maximum 10 years in prison, but the U.S. Attorney's Office is recommending an undisclosed sentence as part of the plea agreement.
In exchange for Janus' plea, the government dropped the other charges against him: conspiracy, bribery and two counts of money laundering.
JaWa Investments is still listed as the owner of a condominium at High Cotton on Oxford's downtown square. The condo was sold for taxes in August, but Scott Walker subsequently redeemed it, Lafayette County records show. JaWa owes $4,140 in taxes on the condo, which includes a 1 percent late fee, according to the county records.