Wire Fraud, Additional Corruption Charge Filed Against Former Chester Sheriff
CHESTER – A superseding indictment has been filed in federal court against suspended Chester County Sheriff Alex Underwood and two former deputies that adds additional charges onto those previously filed.
Underwood and former deputy Johnny Neal now face additional corruption and wire fraud charges in relation to payments made for working at ECHO DUI task force traffic checkpoints.
The Hazel Pittman Center, Chester County’s designated state substance abuse authority, received a federal grant to help pay officers for working at the checkpoints in an effort to curb drunk driving. The program was announced with great fanfare more than five years ago. In May of this year, The News & Reporter exclusively obtained portions of a financial audit of the sheriff’s office (ordered by interim Sheriff Max Dorsey upon taking office) that dealt with officer reimbursements for working those checkpoints.
Payment Discrepancies
The audit compared actual hours worked by officers at the checkpoints with the payments they actually received. As the program wore on, discrepancies arose that became more frequent and involved larger amounts of money over time.
Underwood and Neal began to reap considerably larger checks than they appear to have been earning, with other officers being shorted their due amount.
At one checkpoint, Underwood was paid $300 despite not actually having worked the checkpoint at all. On Dec. 19, 2017, eight of the 10 officers listed as having worked four hours apiece (at a rate of $30-an-hour) were not paid anything, while Neal and another deputy (who has not been indicted or charged) raked in $600 each. The money was paid directly to the sheriff’s office instead of to the county treasurer (thus limiting the ability of anyone outside sheriff’s department to track the funds) and appears to have been dispersed to deputies with no taxes being withheld.
The new indictment states that Underwood and Neal “fraudulently obtained payment for work at ECHO checkpoints that they did not perform based on hours billed to Hazel Pittman for other sheriff’s office employees…(they) skimmed from the payments made to the sheriff’s office account based on work performed by subordinate employees…on other occasions (they) split the money received in the sheriff’s office bank account for the work of certain sheriff’s office employees, while the affected employees received nothing.”
A person with knowledge of the situation told The News & Reporter that deputies who were not paid for their work with grant money from the Hazel Pittman Center may have put down overtime for their work instead. The sheriff’s office incurred hundreds of thousands of dollars in overtime during the years the task force was in operation.
Wire Fraud Charges
The new indictment also states that Underwood and Neal “caused to be transmitted by means of wire communication…(a) deposit of Hazel Pittman in South Carolina to the First Citizens Bank Central Bank Operation in North Carolina and interstate transfer of funds associated” with various invoices, leading to the inclusion of wire fraud charges.
Other portions of the superseding indictment deal with charges the two men, along with former Chief Deputy Robert Sprouse, were already facing. Several deal with the alleged illegal arrest of Fort Lawn resident Kevin Simpson.
On Nov. 20, 2018, Simpson was live-streaming a head-on traffic accident scene near his house, but ultimately ended up streaming his own arrest, which came after he complied with Underwood’s command to leave his yard and go to his porch because of a manhunt that was in progress.
Once on his porch, Simpson said “We’re good, bro. Now, manhunt.”
Underwood was still in Simpson’s yard at that point and appeared to be walking away. As Simpson repeated, “Go manhunt,” again, Underwood stopped, turned around and walked onto Simpson’s porch.
“You got something you want to say,” Underwood said as he approached Simpson.
“Manhunt. Do your job,” said Simpson, who claims Underwood was almost nose-to-nose with him at that point.
“Stay on the porch,” Underwood said. “I’ll tell you what, step over here.”
The video then shook wildly and Underwood was heard telling Simpson that he was under arrest.
Entered without Warrant
It is alleged that Underwood, Sprouse and Neal later learned that Simpson had live-streamed the arrest. They then announced that a radio had been lost during the arrest, returned to Simpson’s home and entered without a warrant, arrested his mother for allegedly having taken the radio, took Simpson’s cell phone and attempted to tamper with it.
An incident report, which wasn’t prepared until weeks after the arrest, indicated Simpson had entered the road and cursed at officers, which was not evident on the video he streamed. Simpson spent parts of four days in jail for charges of public disorderly conduct and resisting arrest. Other inmates at the Chester County Detention Center booked the same day or a day after on similar charges bonded out in less than 24 hours.
Charges against Simpson and his mother were ultimately dropped by S.C. Attorney General Alan Wilson. Indictments for Underwood, Sprouse and Neal in connection with the Simpson arrest ranged from creating a false incident report, to violating Simpson’s rights and causing him bodily injury, evidence tampering and lying to federal investigators.
Alleged Lies
The new indictment does shed some light on the alleged lies Underwood told federal investigators. The indictment alleges Underwood told special agents of the FBI that he first viewed the video Simpson live streamed a week after the incident.
“In truth and fact, Underwood…then and there knew his statements and representations denying such specifics were false, fictitious and fraudulently made, in that he viewed the aforesaid video recording” on the night of the incident.
Climate of Fear
The rest of the indictment deals with corruption charges enumerated in a previous indictment. The charges stem from allegations that Underwood, Sprouse and Neal used their positions as law enforcement officers to intimidate others, took “family members on trips (while) charging the cost to the sheriff’s office,” directed “payments for contracted security detail services through a particular sheriff’s office bank account to avoid tax payment,” used “sheriff’s office employees to conduct manual labor that personally benefitted…Underwood while the employees were actively working for the sheriff’s office” and “establishing a climate of fear within the sheriff’s office to direct and secure obedience among subordinates.”
The indictment notes that upon conviction, the three men may face a financial judgment “equal to the total value of the property subject to forfeiture in the approximate value that each gained from the offenses of conviction.”
Seeks Re-election
Though he is currently suspended from office, Underwood is seeking re-election, running on the Democratic Party ticket for a third term in the Chester County Sheriff’s Office. Should he defeat Dorsey (running as a Republican), Underwood would not be able to be sworn in for a new term in January. An order from S.C. Governor Henry McMaster states that Underwood remains suspended from office until a new sheriff is elected or until Underwood’s case is fully adjudicated. His federal case (he, Sprouse and Neal also face state charges) is not scheduled to begin until February and has already been delayed on multiple occasions. The superseding indictment indicates that the case is now being handled by attorneys Rebecca Schuman and William Miller, both of whom work in the U.S. Department of Justice Public Integrity Division.
