STONECREST, Ga. — Stonecrest Mayor Jason Lary has been arraigned on federal charges for wire fraud, conspiracy and federal program theft, according to the Department of Justice.
In a news release Wednesday from the Northern District of Georgia Acting U.S. Attorney Kurt Erskine, officials said the charges relate to a scheme to allegedly steal federal relief funds granted to the city to help with the COVID-19 pandemic.
“Lary allegedly abused the power and trust conferred on him as Mayor of Stonecrest to steal hundreds of thousands of dollars intended for COVID-19 relief,” Erskine said . “Instead of providing aid to Stonecrest’s deserving citizens, Lary allegedly diverted funds for his own use, including to pay off his taxes and the mortgage on his lakefront home.”
Businesses were allegedly defrauded out of hundreds of thousands of dollars.
A bookkeeper was also arraigned on a federal charge of conspiring with Lary to steal relief funds, officials said.
About $6 million was expected to be allocated to the Stonecrest Cares Program and Small Business Program. However, Erskine said Stonecrest did not disburse the funds to the programs. Instead, the city contracted with Municipal Resource Partners Corporation, Inc. to provide accounting services and to disburse the relief funds as directed by Stonecrest.
Officials said before the contract was signed, Lary allegedly worked behind the scenes to assist MRPC, including by recruiting its CEO, opening its bank accounts, and ensuring that the bookkeeper would be hired as MRPC’s bookkeeper.
They added that many of businesses who applied for relief funds were rejected. The bookkeeper allegedly signed checks directing millions of relief funds to people, businesses, churches, and non profits.
Federal officials said Lary allegedly helped decide where the money would be directed.
Officials said funds were deposited into the Visit Us and Battleground Media accounts and were allegedly used by Lary to benefit himself and others. For example, Lary allegedly used relief funds held by Visit Us to pay for an associate’s political advertising.
Lary is also accused of conspiring with the bookkeeper to allegedly steal relief funds before they were disbursed by MRPC.
In January 2021, the bookkeeper allegedly used her access to one of MRPC’s bank accounts to wire transfer about $108,000 to a mortgage servicing company. Lary and the bookkeeper allegedly knew the purpose of the transfer was to pay off the mortgage on a lakefront home he owned. Around the same time, officials said Lary allegedly directed about $7,600 to be paid by Visit Us for the bookkeeper’s son’s college tuition and rent.
This case is being investigated by the Federal Bureau of Investigation.
“It is very troubling when an elected official, someone sworn to protect the community they serve, violates that oath by stealing relief funds intended to aid their community during a global pandemic,” Chris Hacker, Special Agent in Charge of FBI Atlanta said.
In April, he addressed allegations of mismanagement before announcing he would step back from his official duties for health reasons. He wanted to reduce stress as he underwent cancer treatment.
"There was never an intent on anybody's part to kick back or filter money back or any of that nonsense," he previously said. "The intent was to get the money in the hands the people so they could spend it to do it the right way for their businesses and their churches and their nonprofits."
He also said back in April that he didn't have any intention of resigning.