Kentucky Businessmen Sentenced in Decade Long Scheme to Defraud FCC

Memphis, TN – Charles A. “Chuck” Jones, 52, and Mark J. Whitaker, 51, both of Murray, Kentucky, 
have been convicted of federal crimes and sentenced for a decade long scheme to defraud the Federal 
Communications Commission’s (FCC) E-rate program. United States Attorney Kevin Ritz announced the 
sentences today.

According to United States Attorney Ritz and the information presented in court, the E- rate 
program is an FCC program that provides money to needy schools, often in rural areas of America, 
for internet access and telecommunications services. The program has specific rules that forbid 
service providers to the schools, such as Jones, from paying kickbacks to school officials and 
consultants. The E-rate program also requires participating service providers to charge at least a 
10% copay.

For approximately 10 years, Jones, owner of several Murray, Kentucky businesses, paid kickbacks to 
an E-rate consultant working with the Missouri and Tennessee schools involved in this case. During 
the conspiracy Jones, his employee Mark J. Whitaker, and the schools’ E-rate consultant, made false 
statements and submitted fabricated documents regarding the required copays and the program’s fair 
and open bidding process. Jones used the victim schools as a vehicle to fraudulently obtain money 
from the E-rate program. The loss to the E-rate program was approximately $6.9 million.

Jones pled guilty to conspiracy to commit wire fraud and Whitaker pled guilty to misprision on wire 
fraud.

United States District Judge Mark S. Norris sentenced Jones to 18 months imprisonment, three years 
of supervised release, and ordered him to pay $3.5 million in restitution.
Judge Norris sentenced Whitaker to one year of probation.

United States Attorney Kevin Ritz said, "Protection of federal grant programs that provide
needed services and equipment to our schools in West Tennessee is a top priority of this

office. When dishonest offenders conspire to defraud these programs for their own selfish gain, 
they not only steal tax dollars, but also hurt local schools in the process. We will continue to 
work with our federal partners to root out and expose such fraud against the government, to hold 
offenders accountable, and to recover ill-gotten gains."

Sharon R. Diskin, Acting FCC Inspector General said, "These sentences send a strong message that 
individuals who defraud a vital federal subsidy program, such as E-rate, will be held fully 
accountable for their actions. I would like to thank our partners in the United States Attorney's 
office for the Western District of Tennessee and the FBI for their unrelenting dedication to this 
case.”

This case was investigated by the Federal Communications Commission - Office of Inspector General 
and the Federal Bureau of Investigation.

United States Attorney Kevin Ritz thanked former Assistant United States Attorney Murre Foster and 
Assistant United States Attorney Tony Arvin who prosecuted this case,
as well as the law enforcement partners who investigated the case.
 

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