FBI Agent Testifying At Fraud Case Sentencing Says Current Dade County Magistrate Was Tied In With Dobsons; Prosecutor Says Gott Should Get 78-97 Months

Wednesday, May 21, 2014

An FBI agent testifying Wednesday at a sentencing in the Southern Group fraud case said current Dade County Chief Magistrate Joel E. McCormick was tied in with the firm.

Agt. Stan Ruffin said McCormick was instrumental in selling Lookout Mountain property near Rising Fawn, Ga., from Eugene Johnson to the Dobson family, which began to develop it under the name The Preserve.

He said McCormick was also listed among the officers of the Southern Group in connection with a $1.25 million loan the group took out. He said McCormick made some payments toward repaying that loan.

Under questioning about alleged "conflicts of interest" the current magistrate had at Southern Group, the agent said McCormick appraised some of the lots at The Preserve.

Prosecutor Perry Piper asked, "Aren't such appraisals suppose to be at arm's length?"

Agt. Ruffin replied, "Absolutely. He was a business partner and he was doing appraisals on the early lots."

The testimony was during the continuation of a lengthy sentencing hearing conducted by Judge Curtis Collier for Josh Dobson and Paul Gott.   

Prosecutors said the total amount of the loss in the land fraud was $40 million.

The loss amount in the case for sentencing consideration has been limited to 108 cases in which the government said the Southern Group made down payments for buyers. That amount is around $13 million.

The government has reduced the loss amount for sentencing to $11.8 million after the defense raised certain objections, including the fact that much of the land has been transferred to the Georgia Land Trust.

Agt. Ruffin said the Southern Group not only made down payments for "buyers," but also paid some of their mortgage payments. He said, "The fraud began to unravel when they stopped making some of the mortgage payments."

He said that caused officials of Cornerstone Bank to begin asking questions about how the deals were structured.

Agt. Ruffin was the final witness for the government at the sentencing, then arguments began before the judge.

Prosecutor Piper said the sentencing range for Gott, who was involved in setting up financing for the deals, should be 78-97 months.

Attorney John McDougal sought a lesser sentence, saying Gott was not part of Southern Group. He said the "plan was devised by Josh and Tommy Dobson, Travis Shields and their attorney." Tommy Dobson and Shields have not been charged.

A sentencing range for Dobson will be taken up when the case reconvenes.

Prosecutor Piper said, "This was a scam from the start. They were bilking the banks out of tens of millions of dollars. All that money was going into Southern's pockets."

He said the deal that Southern had with Eugene Johnson was that they would purchase the land piece by piece as they made sales. He said, "Their risk was truly minimal. The only risk they had was were they are sitting today - before someone wearing a black robe."  


Warrants Taken For Girl, 16, After Woman Stabbed Twice During Altercation On Woodside Street

Warrants have been taken for the arrest of a 16-year-old girl after Heidi Swafford, 19, was stabbed twice in an altercation outside a house on Woodside Street on Tuesday afternoon. Warrants were issued against the juvenile for attempted second-degree murder and aggravated assault. The Chattanooga Police Department was notified by a local hospital that a female had arrived ... (click for more)

TDOT Road Worker Killed While Flagging Traffic

A Tennessee Department of Transportation worker was fatally injured Wednesday along State Route 54 near US 412 in Crockett County. James “Pee Wee” Hopkins, an operations technician, was flagging traffic around a maintenance crew when he was struck by an oncoming vehicle. No other TDOT workers were injured. The crash is under investigation. Mr. Hopkins, 63, had been with ... (click for more)

Judge Steelman Was Unfairly Criticized In Handling Of School Bus Driver Rape Case - And Response

We are blessed to have freedom of speech in our society, but I am always amazed at the number of folks who voice such strong antagonistic opinions about things without any apparent first-hand knowledge.   As any who wish to criticize the system should know, people get arrested and charged for criminal offenses every day.  The ultimate charge and penalty which results ... (click for more)

Roy Exum: Our Horses Vs. DesJarlais

It is well-known that shortly after the despicable “Big Lick” faction of the Tennessee Walking Horse industry put on a very-pointed fundraiser for the equally repugnant Congressman Scott DesJarlais (R-Jasper) two years ago, the misguided doctor has repeatedly tried to bully and strong-arm the U.S. Department of Agriculture on the behalf of the vermin who sadistically torture the ... (click for more)

Williams Hired To Lead Restart Of Owls Boys' Basketball

Jay Williams has been hired as Ooltewah’s head boys’ basketball coach, a program rocked by a rape scandal last December that eventually led Hamilton County School officials to disband the varsity team and cancel more than half its schedule. Williams, who has strong ties to Ooltewah High School, previously coached at LaFayette School and Northwest Whitfield high schools in Northwest ... (click for more)

TSSAA Sets Future Division I, Division II Classifications

The Tennessee Secondary School Athletic Association’s Board of Control has released the minutes from Wednesday’s meeting in Hermitage pertaining to football classification period for the 2017-18 and run through 2020-2021 1.  Roll Call 2.  Division I and Division II Classification The Board of Control voted the following for the classification period that ... (click for more)