Arkansas Mother and Daughter Sentenced to Seven Years Combined in Federal Prison for Bank Fraud, Identity Theft and Theft of Government Funds
Fort Smith, Arkansas – Duane (DAK) Kees, United States Attorney for the Western District of Arkansas announced today that Jake C. Files, age 46, of Fort Smith, Arkansas, was sentenced today to 18 months in federal prison followed by three years of supervised release. Files was also ordered to pay $83,903.77 in restitution, on one count each of Wire Fraud, Money Laundering and Bank Fraud. Files was ordered to surrender to the U.S. Marshals Service to begin serving his sentence on Aug. 2. The Honorable Chief Judge P. K. Holmes III presided over the sentencing hearing in the United States District Court in Fort Smith.
According to court records, between August 2016 and December 2016, while serving in the Arkansas State Senate, Files used his senate office to obtain government money known as General Improvement Funds (GIF) through fraudulent means and for personal gain. Specifically, Files authorized and directed the Western Arkansas Economic Development District, which was responsible for administrating the GIF in Files’s legislative district, to award a total of $46,500 in GIF money to the City of Fort Smith. To secure the release of the GIF money, Files prepared and submitted three fraudulent bids to the Western Arkansas Economic Development District. Files then instructed an associate to open a bank account under her name to conceal his role as the ultimately beneficiary of the GIF award. When a first installment of approximately $26,900 was wire transferred from the City of Fort Smith to the associate’s bank account, the associate withdrew approximately $11,900 of the funds in a cashier’s check made payable to FFH Construction, Files’s construction company, and the rest in cash. The associate then hand-delivered the check and the cash to Files who, in turn, deposited the check into his personal bank account.
Files also admitted to submitting a materially false loan application in application in November 2016 as part of a scheme to secure approximately $56,700 from First Western Bank.
Files plead guilty in January 2018.
This case was investigated by the Federal Bureau of Investigations. Assistant United States Attorney’s Kyra Jenner and Aaron Jennen from the Western District of Arkansas and Trial Attorney Victor R. Salgado of the Criminal Division’s Public Integrity Section prosecuted the case for the United States.