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Former Prattsville town supervisor indicted on fraud charges

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An aerial photograph of the flooding in Prattsville on Aug 29, 2011, taken from a helicopter
November 8, 2019 05:29 pm Updated: November 9, 2019 04:13 pm

 

PRATTSVILLE — A former Prattsville official was indicted Friday on fraud charges by the U.S. Attorney’s Office.

Kory O’Hara, 42, the former town supervisor, and Prattsville resident Stephen Baker, 68, were charged with conspiracy to commit wire fraud, wire fraud and theft concerning a program receiving federal funds, according to a release from the U.S. Attorney’s Office. O’Hara was also charged with bank fraud and making false statements in a loan application.

O’Hara was at the helm of the town government during the aftermath of Hurricane Irene in 2011. O’Hara entered into various grant agreements with agencies such as the state Housing Trust Fund Corporation and the state Department of State, according to the release.

“Between 2013 and 2015, Baker provided O’Hara with false invoices from his Prattsville-based modular home business, Moore’s Homes, purporting to reflect construction work on O’Hara’s automotive garage, O’Hara’s Service Station, which Moore’s Homes did not perform,” according to the release. “O’Hara issued checks to Moore’s Homes reflecting payment on the invoices, but Baker returned all of the money.”

“[O’Hara] then submitted the false invoices and fully reimbursed checks to Prattsville and the New York State Housing Trust Fund Corporation to fraudulently obtain $24,915 in grant proceeds under the New York Main Street Program,” the U.S. Attorney said.

The indictment further alleges that between 2014 and 2016, O’Hara submitted those same invoices and reimbursed checks to the state Department of State and to the Office of the state Comptroller to fraudulently obtain grant proceeds for Prattsville under the Local Waterfront Revitalization Program, according to the release.

The indictment also alleges that O’Hara submitted false invoices to obtain grants proceeds from the state Electric and Gas Corporation and used the invoices again on a business loan application to NBT Bank.

Greene County Legislator Jim Thorington, R-Windham, a former Prattsville town councilman, and Karl Heck, director of Economic Development and Planning, were subpoenaed to testify Sept. 5 at the James T. Foley Courthouse in Albany for the investigation.

The Prattsville Town Board made a motion Sept. 9 to hire attorney Tom Capezza for two days, according to meeting minutes. Capezza represented the town in 2017 during an FBI investigation.

Deputy Town Supervisor Bonnie Chase declined to comment on why the town hired Capezza and declined to answer if she had been called to testify.

“We hired an attorney to accompany the deputy supervisor and the bookkeeper because they were both subpoenaed to testify before a grand jury in Albany,” Prattsville Town Councilman Greg Cross said.

Town bookkeeper Michelle Brainard declined to answer if she had been called to testify.

Town Clerk Kathleen Sherman said she did not testify. Sherman referred questions to Capezza’s office.

Capezza did not respond to requests for comment on last month’s story.

Town Supervisor Kristin Tompkins also did not respond to requests for comment on last month’s story.

Cross recalled the events of 2017.

“The FBI came to a board meeting to issue their subpoenas for records from the town,” he said. “It was the talk of the town the next morning.”

O’Hara and Baker appeared Friday in Albany before U.S. Magistrate Judge Daniel J. Stewart and were released pending a trial scheduled before Senior U.S. District Judge Frederick J. Scullin Jr.

The case is being investigated by the Office of the New York State Comptroller, Division of Investigation; FBI; DHS-OIG; and HUD-OIG, with assistance from the U.S. Commodity Futures Trading Commission Office of the Inspector General, and is being prosecuted by Assistant U.S. Attorney Cyrus P.W. Rieck.