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Georgia Company Indicted In Mississippi Plant Failure

Federal prosecutors have made public a new 16-count indictment against a Georgia company and three of its executives related to a failed beef plant venture.

OXFORD, Miss. (AP) -- Federal prosecutors have made public a new 16-count indictment against a Georgia company and three of its executives related to a failed beef plant venture in Mississippi.

The indictment, dated June 19 but made public Tuesday, alleges the defendants knew the Mississippi Beef Plant would fail and did not tell anybody.

The indictment replaces one issued in March.

Named as defendants are The Facility Group of Smyrna, Ga., and chairman/CEO Robert L. Moultrie, COO Nixon Cawood and executive vice president Charles Morehead.

An initial court appearance for the trio is scheduled for July 1 in federal court in Oxford. The defendants are scheduled for an August trial on the March indictment. That date is likely to change.

Tom Freeland IV of Oxford, who represents Moultrie, said his client was served with the new indictment and intends to enter a plea of not guilty and "vigorously defend the case, as always."

The Facility Group, a construction and engineering company, was hired by the state to evaluate the plant's construction and then to manage its construction.

The plant was open only a few weeks in the small town of Oakland before closing in late 2004 and leaving 400 people out of work. Mississippi was stuck with $55 million in state-backed loans for the 140,000-square-foot plant. Two men associated with the plant's construction and operation were sentenced to prison for their own actions related to the plant's failure.

The new indictment alleges the defendants submitted fraudulent invoices to recover political contributions to an unnamed and unindicted public official's re-election campaign.

They also are accused of conspiring and executing a scheme to obtain money by submitting invoices for work not performed and by fraudulently overstating and inflating costs associated with the plant's construction.

While the unnamed official was not been publicly recognized by the government, contributions by The Facility Group, Cawood, Moultrie and Morehead match up with $50,000 in then-Gov. Ronnie Musgrove's campaign finance reports from his failed re-election campaign in 2003. Now a Democratic candidate for U.S. Senate, he maintains he has done nothing wrong.

"Gov. Musgrove believes that anybody who defrauds the state of Mississippi should be prosecuted to the fullest extent of the law," campaign aide Tim Phillips said Tuesday.

The new indictment alleges that, to avoid Mississippi's limit of $1,000 per candidate per election on corporate contributions, the defendants used company employees as "straw contributors," who gave to an unnamed political campaign and were reimbursed by the company.

The government also contends in the indictment that Cawood and The Facility Group learned in early March 2003 from one of its design engineers that national beef producers considered the operation a "money pit" and that it might not be economically viable in the long run without enough livestock to support the facility for more than about 24 months.

The indictment alleges the engineer also told the defendants that the state could face serious problems with its "unsecured loan."

Cawood and The Facility Group allegedly concealed these warnings from the state and Community Bank, which made the plant loan based on a 100 percent state guarantee, according to the indictment.

If convicted, they each face up to 305 years in prison, $4 million in fines and restitution for the amount of the losses, according to the U.S. attorney's office.

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