A federal grand jury returned an indictment on Nov. 14 against Dale Edward Stanley, 53, of Clintwood, Va., for wire fraud involving a scheme to defraud Eastman Chemical Co. of Kingsport, Tenn., on spot market purchases of coal, said the U.S. Attorney’s office for Eastern Tennessee.
Stanley appeared in court on Nov. 19 before U.S. Magistrate Judge Dennis Inman. Stanley was released pending arraignment, which has been set for Nov. 26 in the U.S. District Court for the Eastern District of Tennessee. If convicted, Stanley faces a term of 20 years in prison on each count, a $250,000 fine, and three years of supervised release.
According to the indictment on file with the court, Stanley, the owner of Mountain Energy Resources Inc. of Norton, Va., contracted with Eastman to provide steam coal, which was to have a heat content of at least 12,500 Btu/lb and an ash content of up to 10%, the U.S. Attorney said. It is alleged that Stanley provided Eastman with lower quality coal, concealing the lower quality coal by placing it under higher quality coal in rail cars sent to Eastman. Stanley is also alleged to have paid an employee of a testing service to submit unrepresentative samples for testing. The indictment sets out 22 wire communications from early 2010 to February 2012, where invoices were sent by fax or email to Eastman for payment.
This indictment is the result of an investigation by the Federal Bureau of Investigation. One court document indicates that Eastman Chemical on Jan. 5 initially contacted the FBI about this matter. Eastman Chemical said it was tipped off by an unnamed employee of the coal testing company that had been religiously “saved” over the 2011 Christmas holiday and wanted to confess.
Notable is that an indictment constitutes only charges and that every person is presumed innocent until their guilt has been proven beyond a reasonable doubt. The court docket doesn’t indicate that Stanley has entered a plea.