Two former Lynn Haven city officials are facing federal charges for allegedly paying two local contractors $5 million for Hurricane Michael cleanup that they never completed and then accepting kickbacks from those business owners.
“This case involves the corruptive use of public office for personal enrichment in a scheme to conspire and defraud the city of Lynn Haven,” said U.S. Attorney Lawrence Keefe of the Northern District of Florida at a press conference announcing the indictment on Tuesday.
The 35-count indictment alleges Michael White, 46, former city manager, and David Horton, 55, former community services director, knowingly processed fraudulent invoices from Erosion Control Specialists (ECS) on behalf of David White, 38, and from Greenleaf Lawn Care on behalf of Joshua Anderson, 43, in the months following the hurricane.
Prosecutors say Michael White and David White are not related.
“When ECS invoices were being assembled for submission to FEMA by Lynn Haven for reimbursement, it was discovered that many and most of the ECS invoices that had been paid provided no details in support of the required payments,” said Assistant U.S. Attorney Stephen Kunz, the lead prosecutor on the case.
When asked to provide documentation, Michael White and Horton allegedly created and submitted false timesheets, with the assistance of Shannon Rodriguez, 37, who’s also charged in the indictment, Kunz said.
The five defendants could face up to 20 years in prison for conspiracy to commit wire fraud, up to 10 years for theft of federal funds and up to five years for filing false claims to the federal government.
Prosecutors say the fraudulent invoices were for hurricane cleanup services, including debris removal, landscape work and residential trash pickup.
For example, in the first few months following the hurricane, ECS’s owner David White claimed to have completed residential trash removal and cleanup, which was “not necessary” and never “actually performed,” Kunz said. “Despite the ability of Lynn Haven’s waste trucks to pick up large amounts of household trash and deposit that trash at the dump… false invoices were submitted by ECS for trash pickup for significant periods of time.”
David White allegedly received hundreds of thousands of dollars for each of the fraudulent trash removal jobs, Kunz said.
And soon after the hurricane, Anderson allegedly collected more than $66,000 from the city for lawn care services and debris removal that was never completed.
While the contractors named in the indictment were paid immediately for services that they allegedly never provided, legitimate debris removal businesses had to wait longer for their paychecks.
During this time, Michael White, Horton and Rodriguez allegedly accepted gifts from David White and Anderson.
Michael White received free cleanup and repair work from ECS and then charged the city for those costs, falsely claiming that the work was done on city property. He’s also accused of selling his car and Youngstown farm to David White for $300,000.
Last December, David White also spent $25,000 on a vacation near Gatlinburg that he and his family took with Horton and his family, Anderson and his family, Rodriguez and her family and an unnamed Bay County Commissioner and his family.
“Corrupt public officials undermine the integrity of our government and violate public trust,” said Rachel Rojas, FBI special agent. “Abusing one’s position for personal gain especially in a time of crisis is a blatant disregard to the oath that every government official takes.”
Law enforcement officials say the investigation into the public corruption case is ongoing.
“We’ll be aggressive in our fight to reform this corruption. There may be time for some to change their ways. For others, it is too late,” said Bay County Sheriff Tommy Ford. “These arrests represent the beginning of this case, and I fully anticipate that additional indictments and arrests will make the scope of this problem clear.”