A Third Former Home Depot Employee Pleads Guilty to Kickback Scheme

RONALD K. JOHNSTON, 37, of Atlanta, Georgia, has pleaded guilty to one count of conspiracy to commit wire fraud and two counts of filing a false tax return, arising out of a scheme to defraud Home Depot.

United States Attorney David E. Nahmias said, "This is the third former Home Depot employee who has now admitted accepting bribes from the company's foreign suppliers and then not reporting or paying taxes on that illegal income. This type of conduct corrupts the honest operation of American businesses, and those who pay, receive, or solicit such payoffs risk federal prosecution."

"Kickback schemes undermine the competitive process," said Deborah A. Garza, Acting Assistant Attorney General in charge of the Department's Antitrust Division. "Today's plea underscores the importance of holding accountable individuals who participate in such conspiracies."

IRS Criminal Investigation Special Agent In Charge Reginael D. McDaniel said, "The prosecution of individuals who conceal their income from the IRS, even if obtained from illegal activity, is a vital element in maintaining public confidence in our tax system. We should not expect the honest taxpayer to foot the bill for those who choose not to pay their fair share."

According to United States Attorney Nahmias and information presented in court: Between 2005 and 2007, JOHNSTON, a former Merchant for Flooring, participated in a conspiracy to defraud Home Depot by taking kickbacks from foreign suppliers seeking to do business with Home Depot. JOHNSTON arranged for Home Depot to purchase items for resale on less than the most advantageous terms to the company. Another former Home Depot employee, ANTHONY TESVICH, who pleaded guilty last June to similar offenses, received millions of dollars in bribes from foreign suppliers and passed on to JOHNSTON through kickbacks hundreds of thousands of dollars and also made payments to a home improvement company for work on JOHNSTON'S residence. In July 2008, another former Home Depot employee, JAMES P. ROBINSON, also pleaded guilty to similar charges arising out of his participation in this scheme to defraud Home Depot.

JOHNSTON also pleaded guilty to filing a false tax return by underreporting his income for tax years 2005 ($60,108 in unreported income); and 2006 ($125,893 in unreported income).

JOHNSTON could receive a maximum sentence of 20 years in prison on the conspiracy to commit wire fraud charge, and a maximum sentence of 3 years in prison on each tax charge. JOHNSTON also could be fined up to $250,000 on each count. In determining the actual sentence, the Court will consider the United States Sentencing Guidelines, which are not binding but provide appropriate sentencing ranges for most offenders. JOHNSTON is scheduled to be sentenced on April 1, 2009, at 3:30 p.m., before United States Judge Richard W. Story.

This case is being investigated by the Internal Revenue Service-Criminal Investigation, the Bureau of Alcohol, Tobacco, Firearms, and Explosives, and the Federal Bureau of Investigation. Home Depot has cooperated in the federal investigation.

This case is being prosecuted by John R. Fitzpatrick and Barbara W. Cash, Trial Attorneys for the United States Department of Justice Antitrust Division, Atlanta Field Office, and Assistant United States Attorney Russell Phillips, with assistance from Assistant United States Attorney Sally Molloy.

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Third Atlanta Police Officer Pleads Guilty In Fatal Shooting of Elderly Woman

PRNewswire-USNewswire/ -- The Justice Department announced October 30, 2008, that former Atlanta Police Department (APD) Officer Arthur Bruce Tesler pleaded guilty in federal district court to conspiring to violate the civil rights of Kathryn Johnston, 92, in connection with her fatal shooting during the execution of an illegal search warrant at her Atlanta home on Nov.21, 2006.

Tesler, of Ackworth, Ga., joins two other former APD officers who pleaded guilty last year to state and federal charges in the case. Gregg Junnier, of Woodstock, Ga., and Jason R. Smith, of Oxford, Ga., pleaded guilty in state court to voluntary manslaughter, violation of oath by a public officer, criminal solicitation and false statements, and in federal court to a civil rights conspiracy violation that resulted in the death of Ms. Johnston. Smith also pleaded guilty in state court to one count of perjury. Junnier and Smith also agreed to cooperate in a broader investigation of APD officer misconduct, which has since been completed.

"When law enforcement officers do not live up to the high ideals they typically uphold, we will not hesitate to take action," said Grace Chung Becker, Acting Assistant Attorney General for the Justice Department's Civil Rights Division. "The Department of Justice will continue to vigorously prosecute those who cross the line and commit such violent criminal acts."

According to the information presented in court, Junnier and Smith, on several occasions while working as APD narcotics officers, made false statements in sworn affidavits to state magistrate judges in order to obtain "no knock" search warrants for residences and other locations where the officers believed illegal drugs would be found.

On the afternoon of Nov. 21, 2006, Smith, Junnier and Tesler executed such a warrant at Johnston's home, knowing that the warrant had been obtained on the basis of false information that Smith had presented to a magistrate judge. The victim, who was the only occupant of the house, fired through the door a single .38 caliber shot, which hit no one. Junnier, Smith and four other officers returned fire, hitting the victim with five or six shots, one of which was fatal.

Officers searched the home after the shooting, but found no drugs. Smith then planted in the basement of the house three bags of marijuana that the officers had seized elsewhere earlier that day. Tesler then filed a false APD incident report stating that a purchase of crack had been made at Johnston's home earlier that day and Smith submitted two bags containing crack that falsely indicated the drugs were bought by an informant at 933 Neal Street, the home of the victim. The defendants also met to fabricate a story, which they later recounted to APD homicide investigators, falsely justifying the events leading to the shooting of Kathryn Johnston.

Under Tesler's plea agreement, the parties agreed that the appropriate sentence under the advisory federal sentencing guidelines is 121 months. The federal sentence will run concurrently with Tesler's 54 month state sentence arising from the same criminal conduct. Junnier also faces a guidelines sentence of 121 months, and Smith faces a guidelines sentence of 151 months; those two defendants may, however, receive reductions based on their cooperation with the Government's investigation.

Assistant U.S. Attorney Jon-Peter Kelly, U.S. Attorney David E. Nahmias, and Department of Justice Civil Rights Division Special Litigation Counsel Paige M. Fitzgerald are prosecuting the case.


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