HATTIESBURG, MS (WDAM) - The federal trial for Forrest County Sheriff's Department Chief Deputy and his wife, Linda Bolton, started Tuesday with jury selection and then proceeded to hear testimony from five witnesses.
Charles and Linda Bolton were indicted in March for 10 counts of tax evasion (5) and filing false tax returns (5) between 2009 and 2013.
At 12:18 p.m., a jury pool of 53 was narrowed to 14, with two of those being alternates. The jury is made up of eight men and six women, 10 are white and four are black.
The jury is made up of jurors from all across the southern district, as ordered by District Judge Keith Starrett. Only one jury member is from Forrest County, however made it through the Voir Dire process and was selected.
Starrett informed the jury that the two defendants, Charles and Linda were indicted for 10 violations of income tax codes and not paying taxes on income earned.
Assistant United States Attorney Fred Harper started things off for the government with his opening statements.
"It involves a state of conduct that covers five years," Harper said. "Intent is inferred from surrounding circumstances."
Harper detailed that the Boltons own a pair of "Schedule C businesses, which is Sports 22 and Hall Avenue Package Store."
The Boltons file joint tax returns every year, according to Harper.
"In addition to his paycheck, the Chief Deputy at the Forrest County Sheriff's Department, they had to report that and other income," Harper said. "In 2009, evidence shows they receive checks for liquor from one person, John Lee."
John Lee is a prominent attorney and long time friend of the Boltons according to court testimony.
Harper detailed money that was written in checks, allegedly for liquor, by Lee.
"Those checks totaled $52,870.18, and those were not deposited in the liquor store account, they were cashed," Harper said.
Other checks were detailed by Harper, all from John Lee to Sports 22.
"That is over $273,000 in cash, all to Sports 22, not to Charles or Linda, not one deposited into their business accounts," Harper said. "Not one penny was reported to their Certified Public Accountant firm."
Harper continued to address the jury, telling them that loans cannot be taxed and further detailed money issues.
-2009: $16,604.21 – attempted to deduct, but paid no taxes
-2010: $29,967.77 – marked as a loan, paid no taxes
-2011: $59,105.29 – marked as a loan, paid no taxes
-2012: $16,800.00 – marked as a loan, paid no taxes
-2013: $24,900.00 - marked as a loan, paid no taxes
"All these were not reported as income, but being deducted as loans," Harper said.
He added that these checks that are mentioned are for "goods & services" that were marked as loans on records in evidence.
Harper also mentioned where jury members would see checks from, including:
James Dukes, Bud Holmes, Forrest General Hospital, Dorothy Harris, Manheim Mississippi (Auto Auction) and the Mississippi Air National Guard.
"Manheim had 44 checks, over $60,000 all were marked as loans," Harper said. "Tax preparers prepare returns are based on the information received."
With a brief pause, Harper looked to the jury and then looked to the Boltons.
"No other person is responsible for the Boltons sitting at that table over there but them," Harper said. "The greed never stopped."
Joe Sam Owen, representing Charles Bolton, was first up for the defense in opening statements.
"The first impression is, my gosh, these people are guilty," Owen said. "That's the way the government works."
Owen detailed the fact that this case is not simple, and it involves a very close, more than 30-year friend of the Boltons, Mr. John Lee, and majority of this is just based off mistakes.
Owen informed the jury of Nicholson & Company, who was responsible for the tax returns, who Linda Bolton dealt with for more than 20 years.
"The proof…John Lee gifts about $11,000 a year to the Boltons," Owen said.
"Charles says he was chasing checks for John Lee, and then he would give the money to Lee, often they would go gambling," Owen said. "If John Lee didn't gamble it, he kept it."
Owen referenced that things were often written off by Lee as "office supplies," but stated to the jury, we will know really for what, later in the trial.
Robert McDuff, representing Linda Bolton, followed briefly, touching on the amount of money and that nothing was done but a few mistakes, which could have or should have been caught by the accounting agency.
After opening statements, the rule of sequestration was invoked and all potential witnesses in the courtroom had to leave.
The government's first witness they called to the stand was Robert Bo Beason, the general manager of Manheim Mississippi-Auto Auctions (Manheim).
Beason testified that in 2009 to 2015, they sub-let out cooking to Sports 22 for auction nights at the 113 acre lot on Highway 49, which roughly 500 to 800 people, sometimes 1,000 would show up.
"They would come out weekly and provide food for our customers," Beason said.
He said that anyone could come and purchase food, but that the more clients that spent more money, got more perks.
Beason was contacted by federal investigators on March 22, 2015 regarding the ongoing investigation.
Beason said that he was unable to find all the invoices that were requested in the case, because they are kept off sight in storage, but in 2012 the company went with an oracle based pay system.
He added that he never had a discussion of lending money to the Boltons, or any gifts or any loans.
On cross examination, he was asked if he was ever asked to alter or change any invoices, which he replied no.
On re-direct, he was questioned about an invoice for $2,320.58 that was to Sports 22. That check was paid, and on a hand written note, by Linda Bolton, it showed it was listed as a loan.
"I had no idea what was done with my check," Beason said.
The second witness was Sr. Master Sgt. Kerry Walker, of the 172nd Airlift Wing out of Jackson, MS.
Walker, who works in the contracting office deals with purchasing supplies and things for Unit Training Assembly, which is when the National Guard meets once a month to train.
In 2013, Walker said they contacted the Small Business Bureau looking for a "disadvantaged business, or new or struggling" to do work.
Walker detailed eight weekends that they paid Sports 22 for, each check being $2,750.00.
One date specific, was Aug. 13, 2013, for $2,750.00. Prosecutors compared that check to other hand-written notes from Linda that had it marked under loans.
The third witness to testify was the president and CEO of Forrest General Hospital, Evan Dillard.
Dillard testified about Charles being on the board at the hospital and how members would meet once a month.
Dillard stated that one time, in September 2011 there was a meeting at Sports 22, where board members, Forrest County Supervisors, attorneys, staff and county employees attended.
He also testified that he and others had tried to locate invoices, but were unable to come up with them.
Harper questioned him about a check from Oct. 27, 2011, for $2,108.41 that was in reference to a meeting at Sports 22.
"Since then we felt it was more appropriate to have it somewhere else, or having someone else take care of it," Dillard said.
On Oct. 28, 2011, it was deposited at BancorpSouth, under Linda's notes, it was categorized as a loan.
Dillard was questioned about a manual check request form, and asked about the "explanation" blank.
The jury was shown the document that read: "Advertising"
"It appears to be a mistake," Dillard said.
On cross examination, Dillard testified to the character of Charles Bolton and discussed his time on the board, which was not renewed in 2016.
The fourth witness was Hattiesburg resident, Dorothy Harris.
Harris testified that Aug. 5, 2011, she sent a check via a friend to get a fish plate from Sports 22.
That check was for $8.75, and the government again, showed that the exact amount was listed under a category of loans on hand-written notes by Linda.
The fifth witness to take the stand was Lisa Conn, who has known the Boltons for roughly 15 years.
She was questioned about a check for $1,000 from Feb. 27, 2013, which she said was for food for a birthday party that was held at Sports 22 for Charlie Sutherland.
"We had things like catfish, hushpuppies and coleslaw," Conn said. "Charlie ate there before and really liked it, so we chose that location for the party."
Conn said between 45 and 50 people attended the party.
The check-in question, was later deposited by Linda, and again, marked in the loan column of her hand-written notes.
Conn said she was informed of the amount to pay by Terry Martin.
That check showed up at BancorpSouth on March 1, 2013. Court documents show a hand written ledger, written by Linda, marked "Sports 22, March 13" and under the loan column, the amount matches with the bank records.
Sheriff Billy McGee, Jim Dukes Jr., John Chain, Frazier Bolton, Carl Nicholson, Deborah Delgado and John Colette, were in attendance throughout the day.
Hattiesburg City Council woman Deborah Delgado was asked why she was in attendance, going on the second week in federal court, she replied:
"These are my friends," Delgado said.
Additional Court Matters:
Judge Starrett said he will rule on records requested by the defense in reference to John Lee and records from the Beau Rivage when they arrive in federal court Wednesday.
Both sides, defense and government agreed that the hand-written notes were in fact done by Linda Bolton.