BEAUMONT, Texas – Larry Lee Stephenson, a 48-year-old resident of Port Arthur, Texas, has pleaded guilty to federal violations in the Eastern District of Texas for his role in an elaborate fraud scheme that bilked over four million dollars from inmate families across the nation.
According to court documents, Stephenson and his co-conspirators falsely claimed they could reduce sentences of incarcerated individuals in exchange for substantial payments. They promised a network of confidential informants would conduct undercover drug transactions under court supervision to facilitate sentence reductions. The truth was the funds were used for personal gain, with no such informants or transactions ever taking place.
On September 30, 2016, federal and local law enforcement arrested three individuals in Houston, Texas, as part of this six-year scheme. Stephenson surrendered in October 2023. Over four million dollars was lost to inmate families, and several defendants are facing lengthy prison sentences. Alvin James Warrick, Colitha Patrice Bush, Ronald B. Shepherd, and Alvin Turner were also charged and face up to 20 years in federal prison.
The investigation was conducted by the Federal Bureau of Investigation (FBI), Department of Justice Inspector General, U.S. Marshals Service, Houston Police Department’s Major Offenders Division, and various U.S. Attorney’s Offices. Assistant U.S. Attorney Robert L. Rawls is prosecuting this case.
A sentencing hearing for Stephenson will be scheduled following the completion of a presentence investigation by the U.S. Probation Office.
“This sentence fraud scheme exploited the vulnerable families of inmates, preying on their desperation to help their loved ones. The guilty plea today reflects the seriousness with which we treat such crimes,” said Acting U.S. Attorney Brit Featherston.
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Key Facts
- State: Texas
- Agency: DOJ USAO
- Category: Drug Trafficking|Fraud & Financial Crimes|Public Corruption|White Collar Crime|Organized Crime
- Source: Official Source ↗
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