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Aracoma Contracting, LLC Sentenced for Hiding Millions in Cash Withdrawals
In Charleston, West Virginia, U.S. Attorney Booth Goodwin announced that Aracoma Contracting, LLC, a Williamson-based employee leasing firm, was sentenced to three years of probation and ordered to pay more than $4 million in restitution and forfeit another $405,000 in connection with a structuring scheme involving more than $2 million in cash withdrawals from the company’s bank accounts once held at a Mingo County bank.
The structuring scheme, which involved breaking down cash transactions in amounts of $10,000 or less to avoid financial institution reporting requirements to the IRS, was conducted by Aracoma’s principals, Jerome Edward Russell, 50, and Frelin R. Workman, 58, from January 2009 through April 2012.
Russell and Workman enlisted the assistance of a number of individuals who agreed to appear at the Williamson branch of Bank of Mingo and cash cashier’s checks, which were then brought back to Aracoma’s office to be used to pay cash payroll.
During the scheme, Aracoma sent advance forms to the Williamson branch prior to the structured cash withdrawals, so the bank could prepare the cash ahead of time. Bank of Mingo would then prepare cashier’s checks in the names of the identified individual or individuals and pre-count the requested cash.
Despite numerous times when multiple individuals appeared at the same teller window to endorse cashier’s checks that exceeded $10,000 on Aracoma’s line of credit, Bank of Mingo routinely failed to file notifications, known as currency transaction reports, as required by law.
As part of its sentencing, Aracoma admitted that substantially all of the cash structured out of Bank of Mingo by Aracoma was used to pay the company’s payroll in cash, avoiding the payment of required federal employment taxes and making bribe payments to a former BrickStreet field auditor, Arville Sargent.
Key Facts
- State: West Virginia
- Category: Fraud & Financial Crimes
- Source: DOJ Press Release â†â€â€
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