Description: Charleston, West Virginia criminal defense lawyer represented the Defendant charged withfraudulently obtaining $94,197.93 of federal abandoned mine land (AML) remediation sub-grant funds while employed by the West Virginia Department of Environmental Protection (DEP). Elkins also set up a shell limited liability company to receive a portion of the sub-grant award funds and created fraudulent invoices in an attempt to conceal the nature of the payments.

From on or about April 2017 until on or about August 7, 2019, Jerry D. Elkins, age 54, of Danville, West Virginia, assisted Aleksey Krylov and one of Krylov’s companies with their application for a DEP AML pilot program sub-grant. The DEP receives grant funding from the United States Department of the Interior Office of Surface Mining Reclamation and Enforcement (OSMRE) for, among other purposes, accelerating the remediation of eligible sites for economic revitalization and community development purposes under the Abandoned Mine Land Economic Revitalization (AMLER) program.

Since 2016, West Virginia has received $181 million in AMLER block grant funds. Numerous private entities apply to receive AML sub-grants, and the process for selecting projects to receive sub-grant awards is competitive.

Elkins was initially a regional planner and later an inspector for the DEP during the time period, and had become acquainted with Krylov prior to joining the DEP. Krylov and his company proposed to construct and operate an aquaponics facility that would produce commercial quantities of vegetables and fruits at a project site near Madison. To assist Krylov and his company, Elkins collected water samples, obtained public support, boosted Krylov’s project internally at DEP, provided his opinion and suggestions for improving the sub-grant application, and continuously monitored the application’s status.

In August and September 2018, Elkins registered a limited liability company, Wanaque River Holdings LLC (“Wanaque”), in Delaware and opened a bank account for Wanaque at a bank in Charleston, West Virginia, in order to receive and obscure payments from Krylov. Elkins admitted that Wanaque had no other legitimate business purpose besides receiving funds from Krylov and Krylov’s companies. Elkins further admitted that he directed the creation of a third-party pay-bill account through Bill.com, a cloud-based payments platform, that was used to send invoices from Wanaque to companies under Krylov’s control.

From about October 19, 2018, through about August 7, 2019, Wanaque received $94,197.93 in electronic fund transfers and checks from Krylov and his companies. Elkins admitted that the $94,197.34 originated from the aquaponics project’s sub-grant reimbursements from the DEP and were ultimately diverted to him. Elkins further admitted that he had no right to receive those funds and fraudulently converted them to his own use. Elkins also admitted to taking steps to hide, conceal and cover up his activity and the nature and scope of his dealings with Krylov. Those steps included failing to list his interest in Wanaque when he signed the federal OSMRE State Employee Statement of Employment and Financial Interest form on February 20, 2019.

Krylov, 42, of South Orange, New Jersey, pleaded guilty to aiding and abetting theft from programs receiving federal funds on July 27, 2023, and awaits sentencing.

United States Attorney Will Thompson made the announcement and commended the investigative work of the investigative work of the U.S. Department of the Interior Office of Inspector General-Office of Investigations, and the West Virginia Commission on Special Investigations.

United States District Judge Irene C. Berger imposed the sentence. Assistant United States Attorneys Kathleen Robeson and Holly Wilson prosecuted the case.

Outcome: Defendant was sentenced to 3 years of federal probation, including 10 months on home detention, and was ordered to pay $94,197.93 in restitution.

Plaintiff's Experts:

Defendant's Experts:

Comments: