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Press Release

Former Courtesy Patrol Operator Pleads Guilty to Bankruptcy Fraud

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

BECKLEY, W.Va. – Robert Martin, 67, of Beckley, pleaded guilty yesterday to fraudulent receipt of property from a debtor. Martin admitted to paying himself without authorization while serving as the chief executive officer of the entity that operated the West Virginia Courtesy Patrol.

According to court documents and statements made in court, Martin was CEO of Citizens Conservation Corp (CCC), which he formed in 1993 and which dissolved in or about 2019. CCC’s primary source of income from in or around 1998 until in or around the summer of 2018 was a multimillion-dollar contract with the State of West Virginia to operate the Courtesy Patrol roadside assistance service.

On April 3, 2019, CCC filed for bankruptcy after the loss of the state contract in 2018 left it financially unstable. During a May 2, 2019, bankruptcy creditors meeting, Martin testified that CCC was not generating income, that he was not receiving a salary because of the lack of income, and that he expected CCC to be paid on some receivables owed to it. The United States Trustee, who oversees the administration of bankruptcy cases in the Southern District of West Virginia, told Martin that he was not allowed to take a salary as a controlling officer without U.S. Bankruptcy Court approval.

On May 8, 2019, CCC received more than $41,000 from the West Virginia Treasury, and the money was deposited in CCC’s bank account. Two days later, Martin caused $50,000 to be transferred from that bank account to an account at a different bank. Martin paid himself $32,072.76 from those transferred funds with six separate checks. Martin admitted that he did not obtain or have U.S. Bankruptcy Court approval for those payments, even though he knew that was required. Martin further admitted that he did not get prior approval because he intended to hide these payments from the U.S. Bankruptcy Court.

Martin also admitted that CCC knowingly misspent $108,751.60 it had received from the United States Department of Interior National Parks Service (NPS) between September 10 and October 1, 2018. CCC entered into a Cooperative Agreement with NPS on November 20, 2014 to recruit, hire, train and place young adults for internship positions at national parks throughout the country. Funding made available under the agreement included $111,221.09 to hire and pay two interns to work at the Olmsted Center for Landscape Preservation for 13 months. Martin admitted that CCC did not hire or place any interns with that funding. Instead, CCC drew down all but $2,469.49 of that funding for unallowable CCC operating expenses following the loss of the Courtesy Patrol contract. Martin admitted that he knew that the funds were misapplied or fraudulently converted in this way.

Martin is scheduled to be sentenced on May 3, 2024, and faces a maximum penalty of five years in prison, three years of supervised release, and a $250,000 fine. Martin also owes restitution of $37,072.76 to the U.S. Trustee and up to $251,171.20 to the U.S. Department of Interior National Parks Service.

United States Attorney Will Thompson made the announcement and commended the investigative work of the Federal Bureau of Investigation (FBI) and the U.S. Department of Interior-Office of Inspector General (DOI-OIG). The United States Trustee’s Office for the Southern District of West Virginia made the criminal referral of this case to the U.S. Attorney's Office. The United States Trustee Program is the component of the Department of Justice that protects the integrity of the bankruptcy system by overseeing case administration and litigating to enforce the bankruptcy laws.

United States District Judge Frank W. Volk presided over the hearing. Assistant United States Attorney Holly Wilson is prosecuting the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Southern District of West Virginia. Related court documents and information can be found on PACER by searching for Case No. 5:23-cr-147. 

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Updated January 17, 2024

Topic
Bankruptcy