FOR IMMEDIATE RELEASEENRD
WEDNESDAY, AUGUST 23, 2000(202) 514-2008
WWW.USDOJ.GOVTDD (202) 514-1888
SEWAGE TREATMENT PLANT OPERATOR SENTENCED
FOR CRIMES IN LOUISIANA
WASHINGTON, D.C. -- Glenn Kelly Johnson, the general manager and president of Johnson Properties, Inc., today pleaded guilty to bank fraud charges in connection with a $1.2 million loan used to buy more than 60 private sewage treatment facilities in western Louisiana.
Under the terms of a plea agreement, U.S. District Judge Morey Sear in New Orleans sentenced Johnson to 51 months incarceration, $75,000 in fines, and $1.1 million in restitution to Hancock Bank of Louisiana.
Johnson admitted that he submitted false documents to the bank in order to secure a loan to buy Acadiana Treatment Systems, a collection of privately held sewage treatment plants in Lafayette. The false documents included corporate tax forms and personal financial statements that inflated the true value of the company's assets.
Today's guilty plea follows a previous guilty plea by Johnson in February, which was related to environmental violations at sewage treatment plants he purchased in Thibodaux and Houma, La. In the previous case, Johnson persuaded Louisiana regulators to approve his company's purchase of the sewage treatment plants, saying he had the expertise and resources to maintain the plants. However, Johnson admitted that he diverted customers' fees for his personal use and failed to spend the money necessary to properly operate these facilities. As a result, customers failed to receive basic sewage treatment for years, and many experienced sewage backup into their homes. In June, Johnson was sentenced to 36 months incarceration, $500,000 in fines and $250,000 in restitution for these environmental crimes.
Johnson will serve the 51-month sentence for bank fraud under today's plea agreement concurrent to the 36-month sentence he received in June.
Johnson's mismanagement of the Acadiana Treatment Systems led a federal court in 1999 to appoint a receiver to run Johnson Properties and all its subsidiaries. Johnson Properties and its subsidiaries - Utility Management Services Inc., Johnson Utility Company Inc., Seashore Utilities Inc., Seashore Utilities of Louisiana Inc., Thoroughbred Park Service Corp., and Tara Development Corp. - once controlled the greatest number of privately-owned wastewater treatment facilities in Louisiana and operated more than 200 facilities in Mississippi, South Carolina, North Carolina, Tennessee, Louisiana and Pennsylvania.
The case was prosecuted by the Environment and Natural Resources Division of the Justice Department and the U.S. Attorney's Office for the Middle District of Louisiana. It was investigated by the FBI and the U.S. Department of Transportation, Office of Inspector General, with assistance from the U.S. Postal Inspection Service; and the EPA Criminal Investigative Division.