Chadwick Lusk Admits to $230K Crib Block Kickback Scheme

Chadwick Lusk, 35, of Davin, West Virginia, has admitted to cashing in on a five-year kickback scheme that bled his employer—a subsidiary of Arch Coal—of hundreds of thousands of dollars. The former purchasing agent at the Mountain Laurel Mining Complex pleaded guilty today to honest services mail fraud, capping a federal investigation into systemic corruption in the state’s coal supply chain.

Lusk abused his role as a purchasing agent by taking illegal payments from Gary L. Roeher, owner of CM Supply, Co., every time Mingo Logan Coal Company bought crib blocks—critical wooden supports used in underground mine roofs. Between September 2009 and March 2014, Roeher funneled 7.5% of each sale directly into Lusk’s pocket. The total: approximately $230,000 in cash kickbacks, according to Roeher’s own estimate.

The scheme relied on trust and secrecy. As a gatekeeper for procurement, Lusk ensured CM Supply remained a preferred vendor, all while lining his pockets. In return, Mingo Logan Coal, a wholly-owned subsidiary of Arch Coal, was defrauded of its right to honest services—legally obligating Lusk to act in the company’s best interest, not his own.

As part of his plea agreement, Lusk has agreed to pay full restitution of $230,000. The admission lands him in the crosshairs of federal sentencing guidelines, where he now faces up to 20 years in prison. Sentencing is scheduled for February 3, 2017, before U.S. District Judge Thomas E. Johnston, who oversaw the plea hearing in Charleston.

The probe was a joint operation involving the FBI, IRS Criminal Investigation, U.S. Postal Inspection Service, and West Virginia State Police—highlighting the multi-agency effort needed to crack open underground corruption in the coal industry. Authorities traced cash movements, procurement records, and communications to dismantle the arrangement.

Assistant United States Attorney Meredith George Thomas is leading the prosecution. The case underscores persistent vulnerabilities in industrial supply chains, where insiders like Lusk exploit their positions for personal gain. For now, the message from federal prosecutors is clear: kickbacks in the coalfields will be met with maximum consequences.