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Justice News

Department of Justice
U.S. Attorney’s Office
Southern District of Indiana

FOR IMMEDIATE RELEASE
Friday, March 13, 2020

Phil Nichols and Jess Neal of Muncie, Indiana, indicted on corruption-related charges

INDIANAPOLIS – United States Attorney Josh J. Minkler announced today that the former Chairman for a political party in Delaware County, Indiana, Phil Nichols, and a Sergeant for the Muncie Police Department, Jess Neal, have been indicted on charges of conspiracy to commit wire fraud, wire fraud, and witness tampering. Nichols and Neal join defendants Debra Nicole Grigsby (“Nikki Grigsby”), the former District Administrator for the Muncie Sanitary District, and Tony Franklin, the owner of Franklin Building, and Design, LLC, Muncie, Indiana, who were initially indicted in July 2019 on charges of conspiracy to commit wire fraud, wire fraud, making false statements, and falsification of documents in a federal investigation.

The arrests are part of a multi-year-long and ongoing investigation by the United States Attorney’s Office and the Federal Bureau of Investigation into payment for public works projects in Muncie. The investigation has resulted in the following federal cases:

United States v. Craig Nichols, 17-CR-0021-TWP-DML

United States v. Tracy Barton, 18-CR-284-JMS-DLP

United States v. Jeff Burke, 18-CR-285-SEB-DLP

United States v. Rodney Barber, 19-CR-190-JMS-DML

United States. v. Debra Nicole Grigsby and Tony Franklin, 19-CR-231 JRS-DLP

Nichols, 73, and Neal, 53, of Muncie, Indiana, were arrested Thursday morning and will have their initial appearance Thursday afternoon in the federal courthouse in Indianapolis.

“Public servants need to serve the public instead of serving themselves,” said Minkler. “When someone betrays the public’s trust by stealing tax dollars for personal enrichment, my office will identify, investigate and, if the evidence supports a charge, prosecute the individual who violates that sacred trust.”

As set forth in the Superseding Indictment, Nichols served as the Chairman for a political party in Delaware County from approximately 1990 through approximately 1998. Though Nichols had no official leadership position or title within the political party after approximately 1998, Nichols maintained a private office at the political party’s headquarters, and continued to exert influence and control over multiple official acts performed by certain Muncie public officials.

Neal has been a long time Sergeant in the Muncie Police Department, and is also the owner of Red Carpet, Inc. and Express Properties, LLC.

“Public corruption is a significant priority for the FBI. Crimes of this nature are something we take very seriously, because those who exploit their official position for personal gain undermine public trust and confidence,” said Acting Special Agent in Charge Robert Middleton, FBI Indianapolis. “Today’s indictment and arrest of Phil Nichols and Jess Neal is just one more step in seeking to bring to justice those who have victimized the hard-working, tax paying residents of Muncie.”

According to Assistant U.S. Attorney Tiffany J. Preston who is prosecuting this case for the government, Nichols and Neal face up to 20 years’ imprisonment if convicted of all charges.

An indictment is only a charge and not evidence of guilt. All parties are presumed innocent until proven otherwise in federal court.

In October 2017, United States Attorney Josh J. Minkler announced a Strategic Plan designed to shape and strengthen the District’s response to its most significant public safety challenges. This prosecution demonstrates the Office’s firm commitment to prosecuting large- scale fraud schemes that warrant federal resources and arrest those who abuse their positions of trust. See United States Attorney’s Office, Southern District of Indiana Strategic Plan 5.3.

Updated March 13, 2020