James T. Jacks
Acting United States Attorney
Northern District of Texas

FEDERAL GRAND JURY CHARGES SAN ANGELO FAMILY MEMBERS
WITH CONSPIRACY IN 42-COUNT INDICTMENT

LUBBOCK, Texas — Four members of the “Hughes family,” of San Angelo, Texas, Bobby Ray Hughes, and his wife, Shirley K. Hughes, as well as Bobby Ray’s son and daughter, Jimmy Lee Hughes and Alma Faye Hallmark, were charged in an indictment returned by a federal grand jury in Lubbock yesterday, announced acting U.S. Attorney James T. Jacks of the Northern District of Texas. It is expected that the members of the Hughes family will surrender to federal authorities and appear next week before U.S. Magistrate Judge Philip R. Lane in U.S. District Court in Abilene, Texas, for their initial appearance.

The indictment charges each of the defendants with one count of conspiracy to structure transactions to evade reporting requirements and forty-one counts of structuring transactions to evade reporting requirements.

According to the indictment, Bobby Ray and Jimmy Lee Hughes equally owned H & H Land Development as a partnership. That partnership also conducted business under the names of Bob Hughes Oil Co., Hughes Pipe and Supply, and H & H Pipe & Supply, which bought and sold pipe and oil field equipment. Alma Faye Hallmark worked as a paid employee of H & H Land Development, performing administrative and bookkeeping duties. Shirley K. Hughes was involved in the daily banking activity of the partnership and, on a monthly basis, provided business records, including bank statements, to their Certified Public Accountants (CPAs) to prepare their business and personal income tax returns.

The 42-count indictment alleges that from December 2004 until approximately September 2007, the Hughes family converted numerous third-party checks, made payable to either the partnership business or to an individual Hughes family member, to bank cashiers’ checks, rather than depositing the checks into one of their bank accounts. By doing this, the receipt of those monies wasn’t reflected in the Hughes family bank statements which the CPA firm used to prepare their business and personal federal tax returns. The receipt of third-party checks was unknown to their CPA firm as it was preparing the Hughes family business and personal federal income tax returns for 2004, 2005, and 2006.

1 An indictment is an accusation by a federal grand jury and a defendant is entitled to the presumption of innocence unless proven guilty. Upon conviction, however, the conspiracy count carries a maximum statutory sentence of five years in prison and a $250,000 fine and each of the 41 structuring counts, upon conviction, carries a maximum statutory sentence of 10 years in prison and a $500,000 fine.

The case was investigated by the FBI and is being prosecuted by Assistant U.S. Attorney Ann C. Roberts of the Lubbock, Texas, U.S. Attorney’s Office.

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