Police: Accountant funneled $16.6M from clients' funds
Updated On: Feb 18 2014 05:40:00 PM EST
A accountant from Green Cove Springs is accused of cashing $16.6 million worth of bogus checks, ripping off clients dating back to 2006, according to the Jacksonville Sheriff's Office.
James Hargnett, 50, who was an accountant for Demetree Brothers Inc., a land development company, was arrested in December on charges of grand theft and organized fraud.
According to a warrant, a review of bank records from Jax Federal Credit Union showed that 46 checks were written from a Compass Bank account totaling more than $162,500 in payments toward a mortgage account with the credit union.
Investigators said Hargnett wrote the checks and was the mortgagee.
According to the warrant, bank records from Compass Bank showed that from Nov. 6, 2006, to Aug. 28, 2013, Hargnett conducted more than 254 separate withdrawal transactions on separate dates from more than a dozen accounts of individuals and entities for which he was supposed to be providing accounting services. Investigators said he placed those transactions into the same Compass Bank account, resulting in a total theft of more than $16.6 million.
Investigators said 55 of the transactions were in amounts greater than $100,000.
The transactions resulted in a pattern of racketeering activity, with Hargnett using his business as an enterprise through which he would funnel the stolen funds through the business SA III Partners, investigators said. They said Hargnett intended to use those funds for his own personal benefit.
Investigators said that when Hargnett was confronted by some of the victims, he admitted what he'd done and apologized.
Neighbors of Hargnett said he owned several properties around town, including one across from his ranch and others down the street.
John Maierhoffer bought his home from Hargnett and said he's friends with him and their kids are friends. He said he knows Hargnett as a "good and honorable man."
"He's very humble and he's very respectable and he's very respected in the community," Maierhoffer said. "And I think his family and friends are standing behind him, and I think the world of him."
"It's surprising but people do different things," Maierhoffer added. "And until he's found guilty, I'm going to assume the best of Kevin."
Hargnett's attorney, Hank Coxe, did not want to comment on the case. Hargnett's next court date is next week.
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