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Press Release

Former Bay Springs City Administrator Pleads Guilty to Federal Criminal Charges Related to Embezzlement of City Funds

For Immediate Release
U.S. Attorney's Office, Southern District of Mississippi

Hattiesburg, Miss. – Randy James, 56, the former City Clerk of Bay Springs in Jasper County, pled guilty today before Senior U.S. District Judge Keith Starrett, to money laundering and making false statements on a federal tax return, announced U.S. Attorney Mike Hurst, Special Agent-in-Charge James E. Dorsey of the Internal Revenue Service – Criminal Investigation (IRS-CI), Atlanta Field Office, and Mississippi State Auditor Shad White. 

“One of the highest priorities of this office is bringing to justice corrupt officials who betray our public trust.  I commend local bank employees who spotted this criminal activity, as well as our federal, state, and local law enforcement partners and prosecutors who were diligent in catching this crook and holding him accountable.  We will continue to do all that we can to root out criminality and corruption in all forms of government,” said U.S. Attorney Hurst.

“Today’s guilty plea sends a clear message that public officials, whether elected or appointed, hold positions of trust in the eyes of the public. This trust is broken when these officials commit crimes,” said Demetrius Hardeman, Assistant Special Agent in Charge, IRS CI Atlanta Field Office. “No public official gets a free pass to ignore the tax laws, and IRS-CI works diligently, in concert with state and local partners, to ensure everyone pays their fair share.”

“This loss is massive for a town the size of Bay Springs – over 10% of their annual budget.  Our small towns cannot afford to lose a single penny right now,” stated State Auditor White. “My office will work to hold fraudsters like Randy James, who knowingly steal your money, accountable with zero tolerance for this kind of theft.” 

James is scheduled to be sentenced by Judge Starrett on January 12, 2021, at 10:30 a.m. in Hattiesburg. 

At sentencing, James will face up to 10 years in federal prison, a $250,000 fine, and up to three years of supervised release for money laundering.  Additionally, James faces up to three years in prison, a $250,000 fine, and one year of supervised release, making false statement on a Federal Income Tax Return.

During 2017 and 2018, Randy James was employed by the City of Bay Springs, Mississippi, as City Clerk, and had control over certain financial aspects of the city.  During this time, James embezzled just over $300,000 from Bay Springs between August 2017 and April 2018 by creating fraudulent invoices from fictitious companies for the costs of false services that were never approved or incurred by the city.  James diverted city funds by obtaining checks from the City of Bay Springs, cashing the checks at a local bank, and wiring those funds overseas to international scammers in the hope of winning money in a lottery scheme.

According to the Criminal Information filed in this case, James also made false statements on his personal 2018 Federal Income Tax Return by under-reporting gross receipts by $193,331.00.

The State Auditor’s Office previously issued a demand letter to James for $325,562 which included the amount of his embezzlement, plus interest and investigative costs.  In his publicly filed plea agreement with the U.S. Attorney’s Office, James agreed to pay a total of $420,562 in restitution. 

U.S. Attorney Hurst commended the federal, state and local law enforcement cooperation displayed in this case.  The case was investigated by the Mississippi State Auditor’s Office and by agents for the Internal Revenue Service – Criminal Investigations.  The case is being prosecuted by Assistant U.S. Attorney Stan Harris.

Updated October 7, 2020