Renton man, Darrell N. Winston sentenced to home confinement and community service for role in facilitating fraud scheme
Repeatedly lied to federal investigators about work for King County Drainage District
Seattle (STL.News) A 63-year-old Renton, Washington, man was sentenced today in U.S. District Court in Seattle to three years of probation, including six months of home detention with electronic monitoring, and 40 hours of community service for lying to federal agents about a fraud scheme carried out by a former Drainage District Commissioner and his wife, announced U.S. Attorney Brian T. Moran. In September 2020, DARRELL N. WINSTON pleaded guilty to making a false statement. At the sentencing hearing, U.S. District Judge Richard A. Jones told him he had not shown respect for the law, saying “on these occasions to break the chain of multiple lies, you chose not to do so.”
According to records filed in the case, WINSTON repeatedly misled FBI agents about his agreement with and work for former Drainage District Commissioner Allan Thomas and his wife. WINSTON operated a business called City Biz and originally told agents he had submitted a bid and been hired by Thomas to clean some of the drainage ditches in the district. In fact, WINSTON and his company did little or no work but were paid more than $50,000 by King County based on fake invoices. WINSTON paid most of the money back to Allan Thomas and his wife, and the two used the money for their own benefit. WINSTON lied to investigators on multiple occasions.
WINSTON has agreed to pay $12,958 in restitution to victims of the crime. The amount is the total he received as part of the fraud scheme.
Last summer, the grand jury returned a superseding indictment against Allan B. Thomas and Joann E. Thomas charging them with 15 federal crimes, including conspiracy, mail fraud, wire fraud, money laundering, and aggravated identity theft in connection with their six-year scheme to divert more than $400,000 in local tax dollars to their own use.
Allan B. Thomas served as Commissioner for Drainage District 5 in King County for more than 30 years. As a Commissioner, Thomas was involved in estimating the costs of drainage maintenance for the district so that the county auditor could set and assess the appropriate taxes. The Commissioners then authorized payment to service providers who were supposed to do maintenance work on the drainage system.
As early as 2012, Joann E. Thomas set up a joint bank account with Allan Thomas’ son from a previous marriage. The account was a business account for a company called A C Services. Over the next six years, Allan Thomas had $413,323 of local tax dollars paid to A C Services claiming it was for drainage ditch maintenance. However, financial records indicate that over the six years, shortly after the tax dollars were deposited into the A C Services account, the money was quickly transferred to other accounts belonging to the Thomases, or was used to pay their expenses for such things as hay, mortgage payments, or property taxes. More than $70,000 was withdrawn as cash.
In 2018, after the couple became aware of an investigation into their conduct, they began funneling the tax dollars through WINSTON’s company, City Biz.
In all, the indictment alleges the Thomases defrauded taxpayers of $468,165.
The charges contained in the Thomas indictment are only allegations. A person is presumed innocent unless and until he or she is proven guilty beyond a reasonable doubt in a court of law.
The FBI and IRS – Criminal Investigation are leading the investigation with assistance from the Enumclaw Police Department. The Enumclaw City Attorney initiated the review of the district finances. The Washington State Auditor’s Office also conducted an audit of the district in 2019. The King County Prosecuting Attorney’s Office, in consultation with the U.S. Attorney’s Office, determined the case was appropriate for federal prosecution.
The case is being prosecuted by Assistant United States Attorneys Justin Arnold and Andrew Friedman.