HATTIESBURG, MS (WDAM) - Hattiesburg pastor Kenneth Fairley was found guilty on all counts of defrauding the U.S. government tied to money from the Housing and Urban Development agency.
Fairley, 62, was found guilty of conspiracy to commit theft of government money, and two counts of receiving, retaining, concealing or converting money that belonged to the government.
Here is a timeline of the events leading to his guilty verdict:
Rev. Kenneth Fairley was served with six-count indictment.
- Count 1 - Conspiracy to defraud the United States.
- Count 2 and 3 - Theft of government money.
- Count 4 - Conspiracy to commit money laundering.
- Count 5 and 6 - Engaging in monetary transactions.
On Aug. 3, 2010, the city entered into an agreement with Pinebelt Community Services, which is a HUD certified Community Housing Development Organization. The purpose was to rehabilitate three Hattiesburg residences located on 127 E. 5th Street and 202 South Street.
The agreement was amended on July 19, 2011, to only correspond with two residential properties. On July 22, HUD provided $46,703.50 to the city of Hattiesburg which would ultimately come into Fairley's possession under Pine Belt Community Services.
Artie Fletcher, the owner of Interurban Development, a for-profit development organization based in New Orleans, was contracted by Pine Belt Community Services by Fairley.
The indictment went on to say that Fletcher authorized Fairley to complete bid requests on behalf of Interurban, which were then submitted by Pinebelt Community Services to the City of Hattiesburg as cost projections for the properties under the HUD grant.
Both Fairley and Fletcher agreed that Interurban would not perform the work, but instead Fairley would subcontract the work to local individuals who would perform the work for less money.
Artie Fletcher is a Picayune resident who owns properties across Mississippi and Louisiana.
The 55-year-old was charged with conspiracy to defraud the United States, conspiracy to commit money laundering and engaging monetary transaction in property derived from unlawful activity.
According to the indictment, Fletcher is the owner of Interurban Development, which has been in business for seven years, and is a for-profit development organization based in New Orleans that repairs properties under Housing and Urban Development grants.
According to court documents, Fairley and Fletcher pocketed around $120,000.
Kenneth Fairley and Artie Fletcher were scheduled for court on April 18, but that date was pushed back to June 13, 2016.
Federal court documents showed Fairley's attorney, Sanford Knott, had cited time restraints for a proper defense and asked for the postponement.
Court documents filed June 7 showed that a request to reset the hearing for a jury trial to Sept. 6, 2016, was approved.
Fairley and Fletcher were set to stand trial before District Judge Keith Starrett on Monday, June 13.
Fairley cited six arguments in his attempt for a continuance, some including, violation of a speedy trial and the number of documents in the case was not able to be reviewed in time by his legal counsel, as well as an addition of other legal counsel.
U.S. Congressman Bennie Thompson asked the U.S. Department of Justice to investigate recent Hattiesburg federal investigation he alleged were racially and politically motivated.
In his letter, Rep. Thompson asks U.S. Attorney General Loretta Lynch to "directly investigate organized targeting of the African-American community in the form of prosecutions and other intimidation methods in furtherance of a local political agenda."
Thompson lists several instances of alleged targeting, including federal indictments issued against Kenneth Fairley and Forrest County Sheriff's Department Chief Deputy Charles Bolton.
U.S. District Judge Keith Starrett entered an order to expand jury selection in Fairley's trial.
The order expanded the jury selection from the Eastern Division, to the entire Southern District of Mississippi.
"This cause if before the Court sua sponte for the reason of intense media coverage surrounding the indictment and trial of the above named defendants in the Eastern Division of this Court which sits in Hattiesburg," according to Starrett's court order.
Fairley's attorney, Sanford Knott, filed a motion asking to dismiss counts four though seven, pertaining to money laundering in his indictment.
The motion claimed that counts five and six of the indictment are "fatally flawed because the indicted counts do not allege an essential element of money laundering, specifically proceeds derived from a specified unlawful activity."
Another part of the motion details that counts four, five, six and seven of the indictment are fatally flawed because the indicted counts violate the merger principle and the statutory sense of congress declaration.
The motion was dismissed on an order by District Judge Keith Starrett.
Artie Fletcher pleaded guilty to misprision of a felony before District Judge Keith Starrett.
Starrett explained the charge as concealing a federal felony from authorities, knowing a felony was committed, failing to report the crime to authorities and committing some affirmative act to conceal the crime. The maximum sentence for Fletcher's charge is three years in prison and a $250,000 fine with one year of special release and $100 special assessment.
Fletcher, was indicted on three felony counts, including: conspiracy to defraud the U.S. government, conspiracy to commit money laundering, and engaging in a monetary transaction to criminally derive property.
Fletcher waived his rights to a preliminary hearing, probable cause hearing and indictment on Friday, submitting to prosecution by information.
On the eve of his federal court date, Rev. Kenneth Fairley's legal team filed a motion asking for a dismissal of his case in light of the evidence.
Fairley's counsel filed the motion claiming prosecutorial misconduct, specifically citing his co-defendant Artie Fletcher's role in the case.
Fairley's counsel claims that Fletcher was a cooperating government informant, thus misleading the court.
Fairley's counsel argued that this was a violation of his due process, and requested his charges be dismissed.
Rev. Kenneth Fairley's legal team filed a motion asking for a dismissal of his case in light of new evidence.
Spencer and the rest of Fairley's legal team alleged prosecutorial misconduct, claiming Fletcher and his attorney Clarence Roby were cooperating as government informants.
Starrett presided over a 2 p.m. hearing on the motions to dismiss.
Roby testified via phone Tuesday afternoon and said his focus has always been protecting his client Fletcher. He said he was indigent about the content of the motions and "had not and did not and would not" discuss any conversations he had with other defense attorneys with the government.
Spencer also called Special Agent David Roncska to testify during the hearing.
After over an hour of testimony, Starrett denied Spencer's motion for dismissal, saying the evidence he presented was "exactly opposite" of Fletcher being a government informant.
"This has been a waste of time," Starrett. "I find the motion to dismiss…is not well-taken and overruled."
Twelve jurors were chosen from a pool of 60 for Rev. Kenneth Fairley's federal trial.
There are 12 jurors and two alternates.
Seven of the jurors are women, and five are men.
There are six black jurors, and six white jurors.
Both alternates are black, one is a male and the other is a female.
Assistant U.S. Attorney Jay Golden made opening arguments around 3:40 Tuesday afternoon explaining the government's position that Rev. Kenneth Fairley defrauded the U.S. Department of Housing and Urban Development (HUD) by misusing grant funds that were supposed to be spent to rehabilitate low-income houses located at 127 E. 5th Street and 202 South Street in Hattiesburg. However, Golden argued the construction work was not completed and said the government was alerted about the two properties' states and possible fraudulent dealings between Fairley and New Orleans business man Artie Fletcher when the houses did not pass their inspections.
Golden said the "case at its core" has Fairley, through his HUD certified Community Housing Development Organization Pinebelt Community Services, receiving a contract through the city of Hattiesburg to rehabilitate low-income homes, allegedly selecting Fletcher's Interurban Development as a contractor, and then being reimbursed by HUD for work that was not completed.
Arnold Spencer, Fairley's Dallas-based attorney, stated in his opening arguments the prosecution is only looking at a very narrow portion of the picture. He said the city was entered into a new type of HUD block grant program, and Fairley was unaware of the financial records and receipts that were necessary to keep under this new program.
"Pinebelt could have done a better job with its financing," Spencer said. "(The) accounting isn't as sharp as we'd like it to be, but that's not illegal."
Spencer also stated he planned to introduce evidence later in the case that HUD was satisfied with the work completed.
Golden called the prosecution's first witness around 4:20 p.m. Tuesday. He is 36-year-old Andrew Ellard, who formerly worked for the city of Hattiesburg from Oct. 2009 to Sept. 2014. Ellard said during testimony he worked in the city's state and federal program's office, mostly in accounting and community development. He said that office was created by Hattiesburg in 2009 to better administer projects that were largely grant funded, like those from HUD.
Ellard said he worked specifically with Fairley through Pinebelt Community Services with the two Hattiesburg properties. Ellard said the houses at 127 E. 5th Street and 202 South Street were listed in contracts for rehabilitation. Once Pinebelt Community Services listed rehabilitation work to be completed, Ellard said it submitted reimbursement requests. He said the CHDO submitted one lump sum request for both properties, and Ellard would receive those invoices.
Andrew Ellard, a former city of Hattiesburg employee who worked in the city's state and federal program's office, continued his testimony Wednesday.
He testified about checks from the city of Hattiesburg to Kenneth Fairley's organization, Pinebelt Community Services (Pinebelt), which included checks for $46,703.50 and $51,296.50.
Ellard said he was made aware that HUD was requesting information in the case in the spring of 2012.
Ellard also testified to the failure to cooperate from Pinebelt officials when it came to handing over documents.
"It would take long to get things together, not immediately, but routine things would take time or other requests," Ellard said. "I don't know that we thought money was being stolen."
According to Ellard, the city got one lump sum request once Pinebelt said all the work was done.
Frank Mason, a former HUD employee who retired after 27 years with the government, testified about HUD dealings with Pinebelt.
Mason said that Pinebelt was designated by the city of Hattiesburg as a Community Housing Development Organizations (CHDO).
"The city is responsible for overseeing it… that burden falls on the city, none of HUD," Mason said.
Mason said the contract signed between Artie Fletcher's Interurban Development and Pinebelt Community Services, a nonprofit led by Fairley, was unlike nothing he had seen in 27 years.
"When I got the documents it raised a lot of questions, the documents were incomplete," Mason said.
Mason explained things were missing like bids, forms and multiple items that should all be listed were nowhere to be found.
"I made a series of inquiries for the bids, when I got the documents, there were no bid documents, who did you let the bid to, it seemed it was a conversation between two parties," Mason said. "It just seemed like a handshake, like this is what I want you to do."
Mason said he continued to request documentation, and ultimately sent the request up the chain to his supervisors, and then was given the approval to contact Mayor Johnny DuPree directly.
"Based on the documents, I have to get them to pay the money back," Mason said. "We needed to get our money back and we needed to ensure we had it on record that the money was misspent."
HUD officials later ruled they had enough documents and did not demand repayment. Fairley's legal counsel pointed out a 2014 letter that he claims is the most important document in the case.
Mason said the letter does not prove the houses were built properly and said the investigation by the HUD Office of Inspector General continued after that.
"I'm still not satisfied today," Mason said.
Randy Jordan, 69, of Hattiesburg retired in 2015 as an inspector for state and federal programs with the Hub City.
Jordan said he tried to help Pinebelt but they did not use his input regarding the homes at 127 E. 5th Street and 202 South Street.
Jordan testified to dozens of items that were wrong with both homes during an inspection.
He was questioned if Fairley ever asked him to pass the home inspection.
"Fairley never asked me to pass the inspection," Jordan said.
Jordan said he had trouble getting the East 5th Street home to pass due to the amount of issues, some including the heating and air system and the hand rails on the front porch.
"Mayor DuPree called a meeting with me and two or three other people and put me on the hot seat, Jordan said. "He told me in so many words to file the project out."
Jordan continued to describe the meeting.
"It really irritated me, I was worried about my job," Jordan said.
Jordan spoke of another property that was handled by Pinebelt and the city, but never disclosed the address; just that it was located by Mt. Carmel Baptist Church.
"It was 2014 when I recall that Ellard went with me to inspect the properties…, I felt intimidated from the first property, so I wanted a witness there," Jordan said. "I heard Mr. Fairley say I should retire…"
The fourth witness to take the stand was Cassandra Davis, who works for HUD out of the Jackson, MS, office.
Over the past 14 years, she has been a financial analyst and has been employed by HUD for 25 years.
"I was asked to gather source documentation from Pinebelt and the city of Hattiesburg," Davis said.
She said multiple requests were made and then she was asked by her director, Donnetta McAdoo, to stop by Pinebelt since no documents were being provided.
Davis testified about a meeting that took place at Mt. Carmel where the missing documents were addressed.
"The city of Hattiesburg requested HUDs assistance in getting documents," Davis said. "It was not a good meeting, I got angry."
Davis said she asked one question and never got an answer.
"You can change my mind not with words, but with paper," Davis said to Fairley.
Davis testified that Fairley told her and then other people at the meeting that Pinebelt had no source documents.
Davis said roughly a month later, HUD got documents mostly made up of undated receipts and one or two invoices.
"Those documents were minimally acceptable," Davis said. "Every dollar of HUD money has to be accounted for."
On June 11, 2012, Davis went by the property at 127 East 5th Street, which was after the project should have been completed.
"When we approached the home (McAdoo) was extremely unhappy, and she called the city," Davis said. "It didn't look like any money had been spent on the home."
The government's fifth witness called to the stand was Robert Weeks, an investigator for the HUD Office of Inspector General.
Weeks said he was made aware of the case when he was contacted by the FBI in reference to possible fraud that included Pinebelt.
The investigation showed up on agents' radar when Fletcher filed a civil complaint in Sept. 2013 in Forrest County against Fairley and Pinebelt.
"(From 2010 to 2012)...As part of the conspiracy, Fairley and Fletcher agreed for Fletcher to provide 'seed money' to Pine Belt Community Services (a HUD certified Community Housing Development Organization for the purpose of rehabilitating three Hattiesburg residences), given that the HUD agreement was a reimbursement contract and thus required Pine Belt to incur the costs of the project prior to receiving money from HUD. It was further a part of the conspiracy that Fletcher directed an individual known to the grand jury and associated with the Neighborhood Improvement and Community Education (NICE) Foundation, a non-profit organization based in New Orleans, to transfer the 'seed money' from a financial institution account under the control of NICE to entities controlled by Fairley," according to court records.
Weeks mentioned NICE Wednesday during his testimony clarifying that NICE was sending money to Fairley and Mt. Carmel Baptist Church.
In 2014, Weeks interviewed Fletcher, and on April 22, 2014, he met with his legal counsel and received a thumb drive with emails, audio recordings and other documents pertaining to the case.
Two of the audio recordings between Fairley and Fletcher were played during the trial Wednesday.
"At this time I have run out of patience," Fletcher said. "I don't want to fight with anyone, with a 25-year friendship"
Fletcher and Fairley continued to discuss the spending of $150,000 of Fletcher's money and multiple amounts that Fairley owed to Fletcher through the HUD houses, in which he was the assigned contractor.
"We were praying in September that the funds would come through," Fairley said. "I did whatever I needed to do to raise some funds."
The recording listed $60,000 that Fairley owes.
"Until you and I reach a deal, I am going to proceed relentlessly with this," Fletcher said in reference to moving forward with protecting his family's money. "If Pinebelt is not willing to give me the documents that they owe me $150,000, I have to get it one way or the other, from you, Johnny, the city, HUD or someplace."
From Fairley to Fletcher, Fairley claims he asked God if there is some sin in all of this.
"We have to find a way to clean this up," Fairley said. "I've been shuffling so much stuff around; I'm not in trickery with you Fletch."
Fairley could be heard breaking down on the recorded phone call.
"I don't want to get in the adversary with you, I can't afford to fight with you, I fight with everyone," Fairley said.
Fletcher said, "I have no choice but to take a strong blow at you."
Day three of testimony in the trial of Hub City Pastor Kenneth Fairley continued with Robert Weeks, an investigator for the HUD Office of Inspector General on the stand.
Fifth Witness continued:
Weeks testified to $98,000 of Housing and Urban Development (HUD) money that was given to Pinebelt through the city of Hattiesburg.
His testimony talked about funds that were sent from Neighborhood Improvement and Community Education (NICE) a non-profit organization based in New Orleans, connected to co-defendant Artie Fletcher to Kenneth Fairley's organization, Pinebelt Community Services (Pinebelt).
On March 30, 2015, members of the FBI, HUD OIG and IRS met with Fairley, where they discussed "briefly" about the homes located at 202 South Street and 127 East 5th Street.
"My main focus was to find out what happened," Weeks said. "(Fairley) started explaining the whole process, and what he did at 131 East 5th Street."
That home was one of the first ones "completed" by Pinebelt.
"He said it was for sale, not a rental and he had trouble selling it, so he rented it to his daughter-in-law and his son," Weeks said.
According to Weeks, they currently live at that address.
Investigators then continued to question Fairley.
"It's not what it seems to be, all the money went to Interurban," Weeks said on behalf of Fairley's statements. "He also said he used local labor."
Weeks said that Fairley wanted to speak with him one-on-one, in private with no attorneys present.
"He began to ask me what he was looking at, was it a felony or a misdemeanor," Weeks said. "He said he would have to see this matter all the way through."
Weeks said Fletcher did provide seed money for the projects, which is not illegal, it was how the funds were used that was illegal.
"It was somewhere around $150,000 to $160,000 that Fletcher send to Fairley through NICE," Weeks said.
According to Weeks testimony, Pinebelt is located inside Mt. Carmel Baptist Church, and the executive director is Kenneth Fairley, and Fairley is the pastor at Mt. Carmel, therefore they are all in the same entity.
How money is made:
Weeks testified that through Interurban, no work was actually done, no supplies, no assistance in the rehab, nothing was done through Fletcher's organization.
"Fairley is able to go under the cost that he has turned in and he takes that," Weeks said.
The home at 202 South Street, roughly $10,000-13,000 was used.
The home at 127 East 5th Street, roughly $20,000-23,000 was used.
"He received about $98,000 for the work," Weeks said. "Once HUD suspended the two projects, that is where Fairley was going to pay Fletcher, and when HUD suspended it, it caused a delay."
Fairley then called Fletcher asking for receipts and things to turn over to HUD to get the project back on track.
Weeks added that Fairley submitted forged records to the city of Hattiesburg, tied with Fletcher and his company to qualify for the HUD grants.
"The documents showed that Interurban was being paid and was doing the work," Weeks said. "But statements made by both Fletcher and Fairley told us they did no work."
Another audio recording between Fairley and Fletcher was played by the government.
Fairley and Fletcher continued to discuss projects located on 6th Street and Main Street as well as continued to discuss how Fairley would pay the owed money to Fletcher.
"I was hoping to give you some of your 6," Fairley said. "I'm going to get you yours, I want to get this out of the way."
Fairley told Fletcher they have to make this right.
"I didn't pull out my sword and put on my helmet because I wanted to, I was forced to," Fletcher said
Fairley said, "We have to do whatever we have to do to square up the dollars."
Fletcher said, "I only want what's mine, I don't want to take anyone else's money."
Fletcher questioned Fairley on how much Pinebelt owes him; he pushed him to say it.
"Pinebelt owes me about $150,000," Fletcher said.
"Yes," Fairley said. "That's between me and you."
"Pinebelt, because there is other people involved, other entities, I did not use all that money," Fairley said. "I used it to pay notes."
Fairley claimed that Pinebelt does owe the money, but he could not document it because of the way the projects were done.
"I need to line some stuff up, that all our Ts and Is are dotted," Fairley said. "I haven't gotten any sleep; these guys have been questioning me."
"Those issues are how you have run Pinebelt or Mt. Carmel, not with Interurban," Fletcher said.
"I need to make sure that I'm not jail bound," Fairley said. "They are questioning me man, I got questioned again yesterday, I don't like that man."
Fletcher then questioned Fairley about how many documents he signed "as Interurban."
Fairley claimed it was just the one document related to the two homes.
"I don't want to talk about who signed what on the phones," Fairley said.
The two began to discuss the projects and brought up Hattiesburg Mayor Johnny DuPree.
"Johnny called me," Fletch said.
"I was in here when Johnny called you," Fairley said.
"Johnny will do everything in his power to move these projects forward," Fletcher said.
The two then discussed sending a crew from the coast to finish punch-list items on the homes.
Fairley details that on record Clarence Williams is the director of Pinebelt, and then he took it over.
"I'm saying too much over the phone, you know I'm tapped," Fairley said.
Fletcher disclosed to Fairley that the only reason he had spoken to HUD was regarding a matter with a Section 8 home in New Orleans.
"That little statement right there has made a huge impact to my mindset," Fairley said.
Weeks continued testimony:
Weeks clarified that the crew that came to do the work was from Champion Construction, and it was well after the time the project was said to be completed.
Weeks was questioned by the defense on his background as a law enforcement officer as well as on aspects of the investigation.
"The victim in this crime would be the taxpayers," Weeks said. "This was a reimbursement loan, you get paid back what you put in to it, if it's 10 to 13,000 that's what you get."
Weeks was questioned about the money that went to Pinebelt from NICE.
"The seed money wasn't provided by Fletcher, it was provided by NICE, by his wife to Pinebelt and Mt. Carmel," Weeks said. "It was not going back to NICE, it was going to Interurban."
Fletcher founded the NICE organization, but his wife was on the board, according to Weeks.
Audio was played from a meeting with Andrew Ellard, a former city of Hattiesburg employee who worked in the city's state and federal program's office and Fletcher.
Weeks also cleared up that there was no wiretap on Fairley, and there had not been.
The government's sixth witness called to the stand was IRS Agent Bradley Luker, who works in the Criminal Investigation Division.
Luker testified that he "followed the money" to see where he led him as well as to receipts and documents received during the investigation.
"Majority of the receipts, there was no way to tie it to a property," Luker said. "Any receipt he submitted we took it at face value, and we still saw issues with receipts."
Luker said that in April 2011, Pinebelt had a negative bank account of -$35.22 and then in May, it went to $987.00.
Luker referenced a $50,000 total that was from NICE to rehab the two homes.
Another $10,000 and $5,000 both went to Mt. Carmel out of Pinebelt's fund, according to Luker.
Luker testified to bid requests:
One bid request form for $54,956.50 that was signed by Fairley and Elaine Chase, Fletcher's mother was referenced again.
Luker addressed the 2013 civil complaint filed by Fletcher.
"It outlined the fraud that took place," Luker said. "Taking the difference in the bid and use it for things not approved by HUD and not to rehab homes in the program."
Another $18,000 was mentioned being "operating costs" and that one cannot make a profit off a rehab.
Roughly $100,000 was mentioned by Luker, breaking it down to $50,000 per house.
The breakdown of that being: $46,703.50 and $51,296.50, totaling $98,000.
"Fairley submitted a request for funds to the city of Hattiesburg," Luker said.
That money is earmarked in a separate account, which has to be requested from the city and approved by HUD.
"That request is submitted, then a draw is made, the money is wired to the city then to the Hattiesburg as a Community Housing Development Organizations (CHDO)," Luker said.
Luker said the money should not go from NICE to Fletcher.
"$60,000 is the difference," Luker said. "That's the theft of government funds that Mr. Fairley said he spent that he didn't."
Luker testified to money that was used on the two homes, along with money that was sent to Mt. Carmel.
"The government paid (Fairley) $98,000 in two checks," Luker said. "After he paid a $72,000 check to Artie Fletcher and Interurban, which initiated the next influx of money to Mt. Carmel."
Luker was cross examined by Fairley's legal counsel for roughly two hours, continuing to argue the difference in the $38,000 and where it was actually spent.
Luker while being questioned stated that Mt. Carmel used the money that Fairley received to pay the mortgage, because Seaway National Bank holds the mortgage for the church and Fairley owed $60,000 before it was foreclosed on.
Day four of the federal trial of Hub City pastor Kenneth Fairley kicked off with the government resting its case.
The government rested its case at 8:45 a.m. and the defense requested a directed verdict from District Judge Keith Starrett.
That motion for a directed verdict was denied, and the government proceeded with their first witness, Jonathan Brown.
Jonathan Brown, a Housing Development employee from Ft. Lauderdale, Florida, was the first witness called by the defense.
Brown testified how Housing and Urban Development (HUD) and Community Housing Development Organizations (CHDO) operate.
"Once money comes from the city to a CHDO, it loses its title as HUD dollars," Brown said. "The CHDO doesn't have a relationship with HUD, only the municipality or city does, so the city is responsible for the CHDOs."
During cross-examination, Davis was questioned on how he deals with money in Florida as well as a little of his background.
Davis was questioned about his relationship with Fairley and Fairley's organization, Pinebelt Community Services (Pinebelt).
Davis claimed he has known Fairley for roughly 10 years.
"Expert" Witness issues:
Fairley's defense attempted to qualify three witnesses as "experts" during the course of the trial.
The government objected to the matter, adding that they were not informed of the potential experts until the middle of the trial.
"This is, I just can't… I can't come up with words to describe the issue that's before the court," Starrett said.
Starrett went through when orders were filed and deadlines of when discovery and items were due to the court.
Fairley's legal counsel accused the government of "trial by ambush".
"There has been a gross violation of negligence," Starrett said. "There are also rules and there is fair play."
Starrett detailed the importance and power of having an expert witness in a trial.
"My level of frustration I think is evident…, having to deal with discovery issues to the extent I have had to deal with in this case is just wrong," Starrett said. "Betting on a trial by ambush, which the defense has done is not right and fair."
Starrett denied the acceptance of the three expert witnesses, and moved to only allow them to testify as "fact witnesses," and the rule was invoked for any witnesses in the courtroom to leave until their testimony.
At that point, Arnold Spencer, Fairley's Dallas-based attorney, stepped into the audience to Hattiesburg Mayor Johnny DuPree.
"Are you going to testify?" Spencer said.
DuPree shook his head, and said no.
"Just go ahead and step out, it will mess with their mind as much as anything else," Spencer said to DuPree.
The defense called Brent McDaniel, a former IRS agent and accountant with Price Waterhouse Cooper to testify on a "private 3 to 4 day investigation" he had conducted.
McDaniel said he had been investigating the accounts; however, he had no knowledge of the case prior to the "prepared summary" he was given by the defense.
McDaniel claimed that Fairley and Pinebelt actually spent more than $98,000 on rehabbing the two homes, one at 202 South Street and 127 East 5th.
"The church owned the properties or people in the church did," McDaniel said.
McDaniel testified that there were costs that occurred after the dates from September 2011 to the end of 2012.
During the cross examination, McDaniel was shown multiple land deeds, one of which was related to DuPree.
In 2003, one of the properties in question, 127 East 5th Street was purchased by DuPree in $33,576.00.
In 2005, DuPree quitclaimed the property to Mt. Carmel Baptist Church.
McDaniel was also asked how much he was paid to testify, which was disclosed that it was $15,000.
The third witness called to the stand was Nick Autorina, president and CEO of WFN Consulting in Atlanta.
Autorina testified to the connection between HUD and the city of Hattiesburg, as well as the letter that was sent to the city by HUD officials saying the documentation was sufficient.
He was questioned on cross examination about if a third party had any responsibility related to HUD dollars, to which he agreed.
The defenses fourth witness to testify was a Mt. Carmel church member, and maintenance worker, whose boss is Kenneth Fairley.
Gabriel Bobbitt, a Mt. Carmel member for 17 years, and an alleged contractor on the two home projects in question testified about his role in the work.
"Sometimes I would start at 7 in the morning and it could be 9 or 10 at night when I would finish," Bobbitt said.
Bobbitt said he was the "project manager" over the two projects and kept up with supervising workers and the materials on site.
He also stated that he felt like the work that was done was "quality work."
Former Hattiesburg City Council member Dave Ware was brought up, stating that he came at one point to inspect one of the homes in question.
He also said that he hired at least 10 contractors, 15 to 20 volunteers and even other people in the community for help, and that Interurban, Fletcher's company, did work for the projects.
On cross examination, he was questioned about the work that Interurban did.
"Well Mr. Fairley and Mr. Fletcher said no, they didn't do any work through Interurban," said Abe McGlothin, assistant U.S. attorney. "If Fairley and Fletcher said that Interurban did not do work on the project, they would be incorrect?"
"I guess so," Bobbitt said.
The defense then called former FBI agent, Henry "Hank" Gillespie to testify.
Gillespie was questioned about the dates and the authentication of the audio recordings that were turned over to the government from Fletcher.
The sixth witness to take the stand on behalf of the defense was Carla Irving, a Pinebelt board member, Mt. Carmel 10-year congregation member and "Conference Coordinator" for the church.
She also testified to the work that was done on the two homes in question.
"Interurban was our contractor," Irving said. "I worked to help do kitchens on both projects."
She testified that in 2012, to close out the project, Hattiesburg city employee Franklin Tate went to Pinebelt and asked for a form to be signed, but wanted it dated when the work was done.
She said they called Fletcher and then faxed the form to his secretary, and then it was sent back but signed in the wrong place, so they then called Fletcher again and he said:
"Well go ahead pastor and just sign it in the right place," Irving said speaking for Fletcher.
She also testified to the financial struggles that Mt. Carmel was facing, including $10,000 that the church owed for months for the mortgage.
Irving testified that Fletcher helped pay off mortgages for the church.
During cross examination Irving was questioned about a pair of checks she was given, one for roughly $500 and one for nearly $300 from Pinebelt and a pair of homes that she signed as a board member/ contractor on June 7, 2011.
The final witness of the day was a consulting contractor Elliot Marsh from Soso.
He testified that he did estimations on the 202 South Street and 127 East 5th Street homes just a few months ago.
Marsh also testified that there was work done to both homes and that he made his estimations that totaled roughly $149,000.
For the house located at 202 South Street, he estimated that it cost $50,729.73 due to the work that was currently visible on the home.
For the house located at 127 East 5th Street, he estimated that is cost $98,283.29 due to the work that was currently visible on the home.
He also testified that he never saw those homes, or the actual work in progress being done, only just saw them in the last few months when he was asked to do his estimates.
The jury was then dismissed early and Judge Starrett called for everyone to return Saturday morning with testimony.
The defense for Hub City pastor Kenneth Fairley rested Saturday at 1:42 p.m. after calling a tenth and final witness.
Beginning at 9 a.m. Saturday, the fifth day of the trial began, with the defense originally claiming to call five more witnesses Saturday in addition to the seven from Friday.
Friday's fourth witness, Mt. Carmel church member and Fairley employee Gabriel Bobbitt, was recalled to the stand for further questioning. His testimony changed slightly from Friday, while swiveling in his chair and rocking from side to side during the cross examination.
The government brought up that Bobbitt's wife, Sharon Fairley Bobbitt, operated a business out of the rehabbed home called "Anointed Hands." Bobbitt claimed this happened in 2013 but, Secretary of State records show her signature in June 2011.
The defense called as its eight witness Clarence Williams. Williams was questioned about contracts with Hattiesburg, though most of the questioning appeared to be used to muddy the water by the defense by circling around outside time frames.
The government was part of the impeachment of Williams, citing issues with Housing and Urban Development office as to the reason for his resignation from another city.
Hattiesburg Mayor Johnny DuPree was called by the defense as the ninth witness, acting as more of a character witness for Fairley. DuPree testified that Fairley and have a history extending to the 7th grade, and claimed to be as close to the man "as you can be without being blood," and an agreement was made with Fairley to do their part to better the living of people in their own city. DuPree testified that he was never told Fairley was stealing money and that he did not find out until the indictment.
During his testimony, DuPree also said he at one time owned the house at 127 E. 5th Street and he sold it to Mt. Carmel, saying the last time he paid a mortgage or taxes on the property was roughly, 10, 11 or maybe nine years ago."
Current resident of 202 South Street Rinamae Anderson was called as the defense's tenth and final witness.
The government then called a rebuttal witness, Office of Housing and Urban Development employee Donnetta McAdoo out of the Jackson office. She testified to meetings she had with Fairley, as well as the condition of the home when she saw it.
Noteworthy spectators for Saturday included Eddie Holloway, dean of students at the University of Southern Mississippi, and the mayor's wife Johniece Dupree.
The defense rested their case at 1:42 p.m. after their tenth witness finished testifying.
The government rested their case at 3:18 p.m. after their only rebuttal witness.
District Judge Keith Starrett dismissed the jury for the day and kept the attorneys in his conference room to go over jury instructions so they could be presented Monday, September 12, after the closing arguments.
The 6th day of Rev. Kenneth Fairley's federal trial began with closing arguments, and the case being given to the jury for deliberation.
The government spent roughly 37 minutes for their closing arguments.
The defense spoke for roughly 42 minutes for their closing arguments.
The case was handed to the jury just before 11 a.m.
Hattiesburg pastor Kenneth Fairley was found guilty on all counts of defrauding the U.S. government tied to money from the Housing and Urban Development agency.
During deliberation, the jury sent out a total of four letters to the judge.
At 1:19 p.m., the jury sent out their first two questions:
Should the indictment read Kenneth Fairley Junior or Senior?
Can we have a dictionary?
District Judge Keith Starrett informed them that the indictment had been amended and that they could not have a dictionary.
At 1:30 p.m., the jury sent out their third note:
We need the proper definition of the word conspiracy.
Starrett referred them to jury instruction #9 which related to that charge.
At 4:03 p.m., the jury sent out another note:
The note was not read, however, this prompted Starrett to read the "modified Allen Charge" encouraging them to reach a verdict.
At 5:21 p.m., the jury returned with a verdict.
While the verdict was read by the court clerk, the room was silent, Fairley's wife, who was seated directly behind him, was rocking side to side in her chair.
Judge Starrett remanded Fairley into the custody of the U.S. Marshals and he was transported to the Forrest County Jail and booked in.
Fairley's sentencing date is set for Nov. 21 at 2 p.m.