FEDERAL BUREAU OF INVESTIGATION FOT/PA DELETED PAGE INFORMATION SHEST Civil action¥ 13-cv-00191 Total Deleted Page (a) Page Page Page Page Page Page Page Page Page Page Page Page Page Page Page Page Page Page Page Page Page Page Page Page Page Page 128 129 130 431 132 133 aaa 145 150 159 167 168 169 170 am 193 194 195 196 212 218 227 228 242 243 284 ~ dé: ~ dé: ~ be; ~ b6; ~ bo; ~ v6; ~ BG: ~ BG; ~ 26; ~ dé: ~ ba; ~ bay ~ bay ~ 3; = b3; ~ v6; ~ BG: ~ BG: ~ 6; ~ 6; ~ be; ~ ber ~ be: ~ be: ~ p67 ~ be: bic; b7c; bIC; bIC; bIC; bIC; bIC; b7C; bIC; bIC; bic; bic; BIC; Tc; bc; Tc; bre; bic; bip; bID; ID: BID; BID; BID; 7D; 7D; + BID; b7D; BID; 7D, 7D, bID; bID; 7D; sobanoNgnaNgENcEnN X% Deleted Page(s) x X No Duplication Fee x X For this Page x XXXXKK KAKA KAKKKKARRERE,$7302 (Rev, 10-695) lp FEDERAL BUREAU OF INVESTIGATION Dae of tanserpton pier [social security | interviewed at FBI, Clarksburg Resident ‘Agency, Street, Suite 310, Clarksburg, WV 26301. fter being providéd the identity of the interviewing agents, rovided the following information: c L worked for UNITED STATES REPRESENTATIVE (REP.) ALAN B. MOLLOHAN then took a job with M-H. In October 1998, VANDALIA HERITAGE 01/30/2007 bé bic FOUNDATION (VHF) was_funded and REP. MOLLOHAN asked WHE andl asked to join var. [ continued that 3P and was her [ JaTso HandIed some Bookkeeping for Spout sis nanEhs WRIA Weant paying bills and »§ writing contracts. eventually took over the P7¢ listed herself, aS original VHF employees. [ Jadvised that lived in the Washington, DC area so when she came to work at VF, she stayed in a HOLIDAY INN. VHF paid for the Holiday Inn. [_]then started rentin out the garage REP, MOLLOHAN and located on his property at Fairmont, West Virginia. was paid $650.00 per month which she paid t REP. MOLLOHAN for the rental of the garage apartment. stayed at the apartment just _a few days per month for a two to is be three year period. [-—~—Jalso stayed at the garage bie apartment at one time for a couple of months. According to she had check signing authority at VHF for checks up to $50,000.00. For checks over $50,000.00, both would sign. recalled that [ 1 signed approximately 12 checks. Imesiguien on 10/16/2006 _a# Clarksburg, West Virginia nes S6¢xup-233698-302 -Wb Dae deted 11/1/2006 SA] bs by SA bre “Wis dooument conan notte recommmandons not cones ef 1 the propa of the FB a one Yo yur ogee Mollohan-£22 1nd contents se net lobe tuted ul me 0743). 30D,D302 (Rev. 10-695) 58C-WF-233698-302 Contimation of FD-302 of On 10/16/2006 _,Pags__2. jadvised that she handled REP. MOLLOHAN's personal ace! at paid for the renovations on_his garage apartment. signed the checks. They paid out of this account for electrician services. had either one or_two employees who worked on the renovation to include his son. believed that the renovation was supervised by listed the following VHF employees who also worked on the Yenovation of the garage apartment: metines worked weekends on bé pIc [continued thatL___] garage apartment and that Jhired to do the landscaping on the property. advised that whenever] went over to take a look at the renovations, she tol! mot to tell anyone where she was going. became upset one day when the cleaning lady who cleaned the garage apartment stopped at VHF looking for b6 payment. could not recall if_they paid| jfor’ pI his work on the garage apartment. said that] and would talk behind closed doors regarding the garage apartment and going over to see it. explained that[ Bid not get along. spent approximately five hours per week on the garage apartment and her average work day was 8:00 am to 6:00 pm. b6 As far as| knew, did not_sign checks without ee knowledge for the garage apartment. knew that the timesheets for the VHF employees working on the garage apartment were not correct. According to[(__] REP. MOLLOHAN owned a house in jcanaen Valley and the following people stayed there for free: ]said that neither VHF nor VANDALIA REDEVELOPMENT CORPORATION (VRC) paid for their stay. was not sure if| worked on the bs Canaan Valley house. bic recalled that[ ]Jwent a few places with REP. MOLLOHAN to help him as needed. Mollohan-8230.302 (Rev, 1046.95) 58C-WF-233698-302 Continuation of FD-302 of On 10/16/2006 __, Page advised that was a nice and honest’ person but when did not like someone, would get rid of them. [ Jadvised that tola| she wanted her to work at MOUNTAINMADE because they needed someone. planned bé on staying until she turned[ years old. SO TOld her prc that 808 of her_salary wouldbe paid by VAFand B08 by MOUNTAINMADE . |OUNTAINMADE , hired asa —Jin the MOUNTAINMADE store. her a base salary of $5,000 per year plus commissions. negotiated a $35,000 per year salary plus commissions. said that at the point she left, she had the highest sales. was tobe employed by MOUNTAINMADE for four years and = said she helped| with the properties she b6 owned in North Carolina. worked with the realtors and bre coordinated trips to North Carolina. According to Ce ht have done some work on the North Carolina properties bw did not pay him for it. advised that she used[_____leredit card to get cash for! said she spent approximately two hours per week on personal business. When filled out her timesheets, she never put the time she spent on the personal business of REP. MOLLOHAN and on the trips that planned for Jrould tellL where she wanted to be stay. bre ([—) recalled VHF paying Zofuork tring for consultants working for VHF to include As far as knew, there were not any spouses or children who went on the trips. advised that she had_a VHF credit card that was used for gas in the VHF vehicles. [ ]said that all had VHF credit cards. explained that there was a controversy with staying at the VHF owned house at 719 Benoni Avenue. be6 id not recall the specifics of the controversy. pre said that REP. MOLLOHAN wanted to have a Board of Directors meeting at the Stonewall resort. In addition to the Mollohan-824D302 ev, 10-695) 58C-WF-233698-302 Continuation of FD:302 of Board of Directors attending was REP. MOLLOHAN, ENU On 10/16/2006 _,Pege__4 a | Tasted from Wednesday or Thursday to Sunday. continued that the meeting According to] did not get along with either Tn addition, jas angry about the a rip to Spain and a Spain trip. ert it was just waste of funds. advised that each VHF project had a separate bank account and that none of the projects were ever under budget. and that the timesheets were done during the explained that the payroll was done_in Fairmont day. continued that work on the garage apartment was paid from REP. MOLLOHAN’S personal account. When asked, (replied that it was not true that VHF employees would make up the hours at the end worked on REP. MOLLOHAN's personal business. of the day if they [said she knew whe was staying at the garage apartment and when she was back in the Washington, DC area. stated she did not know According to worked for M-H and was paid by the hour to look for property for VRC. was aid by the hour. Sometimes, was paid by VRC directly, @id not question it. xan VHF and VRC and REP. MOLLOHAN knew everything that was happening. recalled waiting for a big check from REP. MOLLOHAN regarding the property they owned together. The payee wa: thought it was a loan to from REP, MOLLOHAN explained that jpaid for some of the stuff in the garage apartment with her personal check and REP. MOLLOHAN owed personal credi wed. told| that ney. never saw any ch@ck from REP. MOLLOHAN to but he-proDably paid her in person. b6 bic bé bre bé p7c Be bre Mollohan-825FD3028 (Rev. 10-695) 58C-WF-233698-302 Contimation of FD-302 of On 10/16/2006 _,Pae__5 When the investigation became public knowledge in the newspapers, [___]said she thought about potential misuse of funds. Specifically when she wrote checks over a five or six month period to MOUNTAINMADE to help them cover their payroll. recalled| complaining that MOUNTAINMADE could not ee pay them back. Also, thought about the waste of money due to and other VHF and VRC employees always staying at the nicest hotels when they traveled. of Directors member for Christmas. elieved that all donated to REP. MOLLOHAN. VAF did not donate money to REP. MOLLOHAN. jadvised that VHF paid for when he bé went on trips to include mileage reimbursement. bre continued that VHF/VRC_spent $50.00 on each Board said that leach said that VHF would hot_have bought the PALACE BUILDING without REP. MOLLOHAN telling that they had to purchase it. Mollohan-826,D302 Rev. 10-695) FEDERAL BUREAU OF INVESTIGATION Date of tanssption —_0.1/30/2007 West Virginia Work telephone number homé telephone number ‘social securify number date OF birth was interviewed gt her work, Stevens’ Kealty fanagemeye, Trst Street, Parsons, Wes Tt the ‘time he interview pwas—tne| prorDistrict 46 which covers Tucker Counfy. After being advised of the identit of the interviewing agents /and the nature of the interview, provided the following inférmation: bs advised that approximately six or seven years bre ago, farms In the area were being sold to a limited liability company (LLC) and within hours were sold to the United States Government for a significant profit. recalled this happening on at least three separate occasions, specifically there Zo) was a same day transaction where the LLC bought land for $389,000 and sold it to the U.S. Government for $1,000,000. continued that the U.S. FISH & WILDLIFE was amassing a large amount of property in the area and that government organizations usually do not pay as much for property as a normal taxpayer does. b6 bIc was a member of the Chamber & Commerce and Development Authorit: xecommended that the investigators interview two former who resigned four years ago, and who resigned a few weeks ago. jadvised that UNITED STATES REPRESENTATIVE (REP.) ALAN B. MODLOHAN wants to preserve Tucker County. REP. MOLLOHAN met with the Development Authority and soon after meeting with them, Mayor JOE DRENNING from Davis, West Virginia wrote to REP. MOLLOHAN and asked him to not buy the property along Highway 93 because it was "ugly" and the city wanted to develop the property. b6 According to[___] REP. MOLLOHAN tried to stop the bre building of the DAVIS JUVENILE CENTER along Highway 93. The Development Authority wanted to buy 1,000 acres adjacent to the DAVIS JUVENILE CENTER. REP. MOLLOHKAN eventually bought the land instead. The deed for the land where the DAVIS JUVENILE CENTER was Inestinton en 12/02/2006 _x [—_] West Virginia s Fie# 58C-WP-233698-202 —|j) Date deites 11/27/2006 bs bic y SA LR he propa of the FB and sane 1 30H" SOME Yona GOT Hest ei ae beige PSIG] SO.+ PDA2e (Rev. 1046.95) Continuation of FD-302 of on 11/02/2006 Pie 58C-WF-233698-302 to be built was held by ALLEGHENY PowER. [[]recalled a meeting on a Thursday night when REP. MOLLOBAN said he agreed that the Development Authority should buy the land. The next day, Friday, ALLEGHENY POWER said that REP. MOLLOHAN told them to not sign the deed over to the Development Authority. said that a presentation regarding the DAVIS JUVENILE CENTER was given by advised that the DAVIS JUVENILE CENTER was built by MS CONSULTANTS and they did not file wi PS OF pba as required. Pe Widentitied jof the Development Authority and the iomas, West Virginia[__ _]as individuals the investigators should interview. Was also on the Development Authority. said that REP. MOLLOHAN often used the phrase "My Mountains" when discussing land in the area. from the juvenile ‘Jwas advised that MOUNTAINMADE, paid $1,000 per month in_xent for an upstairs apartment in Thomas, West Virginia. said that nothing in Thomas rents for $1,000 per month. jadvised that she is a charter member of the PARSONS REVITALIZATION ORGANIZATION (PRO), a 501(3)c¢ organization. PRO had a plan to build a parking garage and REP. MOLLOHAN. earmarked $100,000 to them for the parking garage, The only bid that PRO ended up getting on the project was from| who worked for CANAAN VALLEY INSTITUTE (CVI) and also had a company called LAKESIDE ARCHITECTS. thought they needed to get at least three bids since it was government funded. b6 bre 6 bic b6 pic Mollohan-828b.202 @ev, 116.95) | aie FEDERAL BUREAU OF INVESTIGATION Date of transcription _01/31/2007 West Virainial ellular telephone NURBEr curity number date oF was interviewed at her place of home telephone number be bre employment, being provide rovided the fc [-—havised she first met [—————]while she was on the Board of Directors (BOD) of COTTRILLS OPERA HOUSE. UNITED STATES REPRESENTATIVE (REP.) ALAN B. MOLLOHAN initially earmarked $500,000 for the renovation of COTTRILLS and the BOD of COTTRILLS was convinced to use VANDALIA HERITAGE FOUNDATION (VHF) as a handler of the funds. The funds came through HOUSING AND URBAN DEVELOPMENT (HUD) and ECONOMIC DEVELOPMENT ASSOCIATION (EDA). The grant was then split between COTTRILLS and the ee BUCKSTON Es All contracts were signed by VHF, bc he identity of the lowing information: nterviewing agents, specifically and VHF never provided any information regarding how they spent the money. The COTTRILLS BOD had no say on the spending of funds for the renovation. A lot of the members of the BOD left because they no longer had decision making ability due to VHF. MOUNTAINMADE, took over as fhe BOD in 2003- According to 32 the ee nF Country Store from June 2004 to April 2005. Tn April 2005, took over for Jat TAL IE. told Jwas very unorganized. Jsaid the truth was that started to question about some of the expenses on her MOUNTAINMADE debit card. as told this by also toldf that bs Twas consistently going into office asking for bre receipts, said she could hear them talking about it. ord to throw receipts away, specifically recalled Tantioning a receipt. for a DUESS. [- continued that the expenses that, did not have receipts for were purchases that were suspicious in that it was hard for to imagine the purchases not being personal. trvestgaton on 01/23/2007 at fis 58¢-WF-233698-302 “WS Dae detted 01/31/2007 b6 by SA bre ‘issu arts rter rman rer cr th Le he popty oe Fan ard Jour sta Tan cant ow ut be Gatun ct You gee. Tr Mollohan-829 FSU. SODH.302 (Rev. 10-6-95) 58C-WF-233698-302 Continuation of FD-302 of jadvised that in a conver: 0n.01/23/2007 _,Pogs__2 sation with two fellow employees OF MOUNTAL learned that another Jalso_questione: about re: at MOUNTAINMADE, ceipts for expenses. Allegedly told about| explanation of charges on the debit car was fired told Jlack of recei bie ‘d. Subsequently, about the situation. ace married and[ was fired from 2007. about fouror tive months into her time so around September or October 2005. M said she noticed the situation with the debit card OUNTAINMADE had two accounts at HUNTINGTON NATIONAL BANK and the account in question had an account number that ended in account had not been balanced in over a that Jqestioned were for cigarette alcohol, clothes ($1,100 at one store), vacations. [___J]found a total of appro: April 2005 to February 2006. ecalled that in Decembe. old her about_the issues he wi realized the year. Some of the items s, meals, groceries, make-up, and personal ximately $12,000 from x 2005, as having with| This was the time that [ ]told her about They all felt they would be fired if th ey told anyone about it. Jsaid that Jas the| situation with so she decided _t: 9 tell the outside accounting firm, TOOTHMAN RICE. issues for TOOTHMAN RICE and monthly and In a meetin issues until told| that if she covered Into trouble since she would be committ: rarely handled the she told them | gust 2006 and was laid off on January 5, be bre immediately called TOOTHMAN RICE's in-house counsel and they decided that TOOTHMAN RICE did not have a close enough working relationship to be liable. The meeting was held in their Bridgeport, West Virginia office and was in February 2006. this up she could get ing fraud. CSS ena plained that she did not know how to handle the Inandled day-to-day took over for him. ck of explanation regarding nses and Eaangise was, "I know] does that" said that either nad been told this before or else saw it herself Ne since she did the bookkeeping personally when MOUNTAINMADE was ee between bookkeepers. Upon hearing this fron Mollohan-830,FD-3020 (Rev. 10-6.95) S8C-WF-233698-302 Continuation of FD-302.0f __| On 01/23/2007 _, Page suggested that[___]bring this to the MOUNTAINMADE BOD. Inever spoke of It again with TOOTHMAN RICE again after this meeting. advised that the BOD for MOUNTAINMADE consisted of said that REP. MOLLOHAN had attended a meeting before as well and also contributed via conference call. explained that_she took the advice of TOOTHMAN RICE and decided to contact said that seemed appalled and told he needed to digest the information. lcatted an attorney, [ Luho told him he should ca then called| the next day and informed her Sy WEES going to research the situation. According to| she then met with Jprior to the next BOD meeting. anted to attend the meeting but was not allowed. each wrote a statement of what was happening. ote one as well even though she was at the meeting and overnighted all four statements. They said that "we will take care of it". [(—Jadvised that the next MOUNTAINMADE BOD meeting was held at VHFTE Highgate office and — and the BOD members: was_not sure if| Jwas_at the meeting. During the BOD meetini see @ about finances, directing his speech towards said that as somewhat aggressive towards| Specifically regarding her spending. They never finished the meeting since each of the BOD members present had a meeting with LNU, from the NEW YORK TIMES, regarding earmarks sent to MOUNTAINMADE from REP. MOLLOHAN. said that the next mornin resigned via letter and copied on the e-mail. ld te keep the situation confidential and to make a Tist of questionable expenses_and expenses without receipts. Qne week later, [tor that the BOD did not accept resignation 50 Was staying on as [ I (beatae Jalso wanted to meet with Individually but they did not trust| 50 Sat_inon the meetings with the other three asa witness. said the same thing in each of the meetings b6 bIc b6 BIC b6 7c b6 bre Mollohan-831¥D302a Rey. 10-65) 58C-WF-233698-302 Contain of FD302 of __| On 01/23/2007 _, Page said that what so did not need a separate meeting. was saying seemed scripted and they felt like there were on a witness stand being interrogated. basically blamed them for snitching on| b6 told them it was a BOD decision and they interpreted that o quiet about the situation. also gav that there would not be any retaliation. said that she thought REP. MOLL the situation and approved of how the BOD hand: question totaling approximately $12,000 and According to came to 2006 and told her to approach with the expences in explain the purpose of each expense. [7 |said this was a ver: hey should keep ad e them a letter OHAN was aware of led it. her in mid-April would uncomfortable situation for her since had _toidl 1 what [__]had said regarding the expenses. claimed that approximately $7,000 of the $12,000 were for p and she paid that amount using numerous person: recalled one of the expenses th: claim being_a personal trip to SNOW BIRD MOUNTAIN LODGE in North carolina. went to a movie premier tha’ work related but added onto the trip by going new that ["“]went on the trip becaus about it, showed pictures of her trip to SNOW BIRD, an saw the expenses for the trip. from UNIVERSITY, as a consultant to fix the problem: told the employees that they discuss the issues with anyone or they anyone about also demoted _ea advised that the MOUNTAINMADE BOD then hired was aware of the issues the employees had with Including the expenses. [_____] was also a good friend of fired. brought in was to threaten them and make sure they di hot tel bea ersonal expenses ae al checks. a at did not t apparently was to_SNOW BIRD. e a WEST VIRGINL s at MOUNTAINMADE. were not to ch of them, es was moved from was moved from moved from and ti ovea to the MOUNTAINMADE Country Store-sad S not allowed the MOUNTAINMADE work space. e-mailed about the situation because she felt, it was Yetaliation and kept copies of the e-mails. never Mollohan-832 |020 ev. 106-95) 58C-WF-233698-302 Continuation of FD-302 of +0n.01/23/2007 __, Page received a reply. was there for one month and was paid $30,000 plus the rental of a house in Canaan Valley and mileage. According to the BOD immediately discarded debit card and toll to obtain another credit card. credit. Around July 2006, finally obtained a secured bre credit card from MsT BANK. questionable items on the new card, Travel", books, and coffee. again started charging including: "Director's Since would have signing authority and ke eae was small, many banks would not, ai a card due to bad be advised that, handed out a letter to all employees explaining thar was repaying fox aly her personal expenses. said that even though told what had told him, jas never asked to look nto past years accounting. jcecalled that she was being interviewed by LNU from the NEW YORK TIMES in her INMADE office wit! standing behind [___] When asked about whether "HOUNTAINMADE rented the Studio apartments from VHF, was nodding so would lie tol ] MOUNTAINMADE does pay rent to VHF for the studio apartments. bé bic said that on July 10, 2006, was hired as Jand_in June 2006, was hired _as an They_were hired to help with her day to day work so she could focus on marketing For MOUNTAINMADE.. jadvised that who was recently hired in the IT department at CAN VALLEY INSTITUTE (CVI). was a friend of was given full access to MOUNTAINMADE's computer network. was the [ ] department at MOUNTAINMADE. In August 2006, the e-mail _system crashed and the next day the entire network crashed. could prove that the system was shut down from CVI and he felt a he was sabotaged. [told th: | ae pee it MOUN: 7 who told relayed the information to who then fired was hired on as a full time employee of MOUNTAINMADE last week. cS Mollohan-833#302. ev. 10695) 58C-WF-233698-302 Contato of FD-302 of On 01/23/2007__,Page__6 was let go in August 2006 due to schedule issues. a applied for mene’ telen ComaH cete fought it and won ke the unemployment trial. received no money though a5 she was attending college at the time. When asked why she stayed on at MOUNTAINNADE so_long, replied that they did not want to let win. felt that someone would eventually get rid of Jadvised that b6 decided to file a retaliation lawsuit against MOUNTAINMADE Ic They approached a few attorneys in West Virginia, said she did not have enough experience in employment lawsuits, another attorney said no because he was a Democrat, and a third attorney,. from Morgantown, said no because he had connections to REP. MOLLOHAN. said that REP. MOLLOHAN dictated what MOUNTAINMADE, reiterated that REP. MOLLOHAN had to know about expenses. was always saying he "had to tell NTan about this" or MT-Rave-te run this by Alan.” said she was told b' that after the BOD 6 meeting where they ques! her about the expenses, she was bre threatened by the BOD. also said that she hired a attorney and told the B she was going to sue them. thought this was one of the reasons they decided to not accept her resignation. also told that since MOUNTAINMADE had liability insurance Tor embezzlement and she was an of MOUNTAINMADE, she was covered by the Insurance and not liable as long as she was employed by MOUNTAINMADE . jadvised that cf and since spent al money frivolously so should be able to Spend MOUNTAINMADE money in the same manner. spend two weeks in Japan promoting MOUNTAINMADE and_in December 2006, went to China for MOUNTAINMADE. friend and an artist went witl HOUNTATNMADE be paid for hotel. estimated tha spent pre $9,000 in travel from October 1, 2006 to December 31, 2006. Accor: ol Jlives on the of the The Country Store is on the first floor and studios for the MOUNTAINMADE artists are on the second Mollohan-834#D.302n ev. 10-695) Continution of FD-302 of 58C-WF-233698-302 On 01/23/2007 _,Page__7. floor. The PEACOCK BUILDING is owned by VHF and MOUNTAINMADE pays $2,500 per month for the Country Store space, $1,700 per month for the studios, and per month for her apartment. | is supposed to pay VHF $1,000 never saw any payments to VHF for the apartment but old her she paid them dir bed MOUNTAINMADE paid for utilit: while and 7 eventually repaid MOUNTAINMADE $900. came up with the idea that MOUNTAINMADE should rent the apartment next door to her apartment for artists to stay when they came to MOUNTAINMADE. The apartment was-ouned by VHF and_was in the SAGACE BUILDING. Once rented, friend, (phonetic), stayed jptaeajarenent for free for approximately five months. While was in the apartment, other artists had to stay in hotels paid for by MOUNTAINMADE. advised that| jabused the car owned by bs MOUNTAINMADE. took it on numerous personal trips. When bre used her personal car for trips, she turned in expenses for both gas and mileage. [___]said that not only can she not claim both on her expenses but also she said that federal law states that since MOUNTAINMADE had should have only been ‘able She charged $0.44 per mile. a company car available, to charge $0.28 per mile but According to MOUNTAINMADE BOD member was the or REP. MOLLOHAN. wanted to also become a paid consultant to MOUNTAINMADE but MOUNTAINMADE's Bylaws state that the members of the BOD cannot be paid. When [ Jasked she responded that REP. MOLL ‘old her that MOUNTAINMADE had to hire and pay her. started as to MOUNTAINMADE sometime in November and Yesigned as consultant immediately after the investigation into REP. MOLLOHAN became public knowledge in the media and the subpoenas were served, around April or May 2006. discovered that was charging MOUNTAINMADE for her time and be mileage driving Eoand from BOD meetings. lalso charged ae MOUNTAINMADE for her time during BOD meetings. informed situation and responded that she would talk to about it, I neve from regarding| her for work completed. said that MOUNTAINMADE's audit was done by| who’ believed was a stand alone CPA. oo received further information continued that she never saw Jdo any work as a consultant even though they were paying Mollohan-835#D-302a (Rev. 10-6.95) 58C-WF-233698-302 Continnstion of F302 of 00 01/23/2007 _,Page__8 bs bre to ssues she had with balancing the bank account that had lebit card and questionable expenses. id not Seem interested, never looked into it from what could tell, and just provided adjusting journal entries to correct any issues. advised that she handled the reimbursements and applications for the grants received from the SMALL BUSINESS ADMINISTRATION (SBA). The budget for the grants was provided by xeported expenses and reimbursements as reported them to her. specifically mentioned| bé spending money on travel and purchased books for the studio. bre said the books were never in the studio. [-__Jcontinued that did not include travel in the latest budget because she TE was too much of a hassle. was now reimbursed using program income. explained that in November 2005, she was told by to move their bank account to GRANT COUNTY BANK because TE was in REP. MOLLOHAN's district. said that she only signed checks when was not there and if the checks were under $5,000. Checks over $5,000 required both her and Re signature. es said that at one point, called| Jto borrow approximately $5,000 from VHF for MOUNTAINMADE'S payroll. MOUNTAINMADE also was late in rent payments to VHF at times. According to CP, representatives that MOUNTAINMADE dealt with were LNU in the beginning, then jnandled day to day issues_and [ ] b3 Randled the bigger problems. Prior_to dealing with SBA bé grants, nandled it. while Iwas bookkeeper, no SBA bic employees came to MOUNTAINMADE. poe that SBA called her once the SBA received a subpoena for documents to ensure they had all documentation. advised that reimbursement for SBA grants was bs handled on @ quarterly basis. If MOUNTAINMADE spent more money bre in one quarter than they budgeted from SBA grants, they were only reimbursed for the amount budgeted. If MOUNTAINMADE spent under the budgeted amount, they were only reimbursed for the amount they spent. Mollohan-836,D028 (tev. 10-695) 58C-WF~233698-302 [-Jcontinued that in the 4th quarter of 2005, MOUNTAINMADE did not have enough expenses to reach their budgeted amount which meant they would not be reimbursed for the budgeted amount. MOUNTAINMADE had been above their budgeted amount in_the 3rd quarter of 2005 and reimbursed at the budgeted amount. Jtolal Jto go back into their Quickbooks Accounting Software and change the dates of some checks so it would appear the work was done in the 4th quarter. MOUNTAINMADE then claimed these expenses in the 4th quarter to help them reach their 4th quarter budgeted amo: jet ‘and receive full reimbursemé rom the SBA. tol to pick the checks and Inecalled one of the checks changed being payable to} The total of the approximately five checks was $20,000 se am 0. said she knew it was wrong and assumed that Jalso knew it was wrong. According to they were specifically under_their inventory budget in that same quarter. directed [ 1 andl -"] to call HINKEL's GIASS and place an order for $10,000. made the call to HINKEL's and also requested that they preé-date the invoice, which they did. MOUNTAINMADE pre-dated a check to HINKEL's to ensure the expense would be reimbursed in the 4th quarter 2005, which[_Jalso knew was wrong. ([Jadvised she had no knowledge of any other pre- dated invoices or any completely falsified Se [oP isaia it would be difficult to falsify invoices. aid that MOUNTAINMADE usually went over their SBA budget. told that 10%_of the SBA budget can be moved from one category to another. recalled getting SBA approval to move some budgeted money around in the 4th quarter 2004. said that was paid out of both SBA grant money and program income. dvised that REP. MOLLOHAN controlled everything within MOUNTAINMADE. REP. MOLLOHAN wanted MOUNTAINMADE to have a catalog so MOUNTAINMADE spent $60,000 on a catalog. On one visit, REP. MOLLOHAN disapproved of some curtains and had them removed. Approval of the blinds replacing the curtains was sought after by MOUNTAINMADE and received from REP. MOLLOHAN. po ecaltea a FNU LNU female who attempted to get on the list Of artists utilized by MOUNTAINMADE. MOUNTAINMADE did not accept her on the list. REP. MOLLOHAN called! and told her to put the artist on the list, which id. CContimtion of FD-302 of +0n01/23/2007 _, Page b6 BIC 6 bre 6 bic Mollohan-837#0.3i20 Glew 10-695) 58C-WF-233698-302 Continuation 0-302 of __| 0 01/23/2007 _,Page__10 According to and REP, MOLLOHAN talked two to four times per month- advised that MOUNTAINMADE paid to have bs apartment cleaned. bre said tha’ nad a very close relationship. would often spend the night at C home residence in Fairmont, West Virginia. provided the following telephone numbers: Home - Cell - b6 bre Home ~ said that was also an employee at MOUNTAINMADE. Mollohan-838¥D.302 (Rev. 10-695) FEDERAL BUREAU OF INVESTIGATION ‘Date of temseription 02/28/2007 [celiutar was conducted with wape SkL_ 7“ After being advised of the identify of the Interviewing agents and the nature of the interview, jprovided the following information: be bre jadvised that she was first hired on at MOUNTAINMADE asa contractors _along with| was hired_in Twas was hired as the in the beginning but was not there long. When eft, Ipecame jin early 2002. duties included scheduling and purchases for the retail store. started do: artist re-orders 7 at the end of 2003, beginning of 2004. took over all uxchases in mid 2004 and he titled was changed to[____] 29) jin 2005. reported the Eo the Board of Directors of MOUNTRINMADE Fn Warch 2008.” Soon after, it was recomended by someone always go with when she made purchases. believed that wanted to reduce her responsibility until they did not need her anymore. was also helped with inventory control. They would count the inventory and compare it to the ee inventory list in the database. Items were always missing, for oe example, clothing apd pottery, An -ecmail was sent out regarding the missing item: developed a sign out procedure for MOUNTAINMADE items but would not follow the procedure. went as far as ocumenting the wrong sku number. repeatedly discussed the issue with were afraid to tell the Board because of possible retaliation. irvestgaton on 02/21/2007 West Virginia fe 58C-WF-233698-302 oie aetes 02/28/2007 y SA bé bIc “Te docu cnn ner recommancaons nor cencusons of he FEL ie the prope ofthe Fl and i loaned lo your agen, ‘and te contnts ae not fo be etbed outed your 3 Mollohan-* to be ett your agen. 4G0l-30. jollohan-839"FD-302 (Rev. 10.6-95) S8C-WF-233698-302 Contimation of D302 0f __| On 02/21/2007 _, Page jsaid_that worked part-time retail until the Former, left b6 November : er] OOK over for bic became left because she could not work with] would bring issues up during staff meetings which would reflect poorly on| [ heard that pont to the Board, specifically regarding issues with believed the issues included reconciling of the a | card and that other_employees had issues with Wi en be fired by| heard this information from who BIC was told by According to said "don't trust the Board" on her way out the door. said that was replaced by who was unable_to reconcile the credit card statements. eard pois en. [came to about ERS Zanue Spe{ OIGer She Gia Hot have the receipts. [ Jtola [ that contract was not renewed due to lack of SMALL BUSINESS ADMINISTRATION (SBA) grant oversight. was a part of the art community and close bs friends with a MOUNTAINMADE employee. bre [advised there was a lapse of two to three months between This lapse was covered by from TOOTHMAN RICE who would come in once per week to Handle ‘bookkeeping duties. Inandled the daily deposits. (co) e*plained that before left, she trained as her replacement. ((~Irecalled a trip in 2005 to Baltimore for an artist s as not, with when she bought many items to include hats and be pottery but they seemed like personal items. [7_]was not sure bic at the time which method of payment >——Jused. (7 Teontinued that she and[—Imet with UNITED STATES REPRESENTATIVE (REP.) ALAN B. MOLLOHAN regarding a trip he had made to a Vermont Country Store and wanted MOUNTAINMADE to have a country store as well. REP. MOLLOHAN requested that Mollohan-840'FD-302 (Rev. 10-695) 58C-WF-233698-302 Conimaton of FD020f __| 0 02/21/2007 __, Page they go to Vermont to see it for themselves. protec tent straight to Vermont from Baltimore-—Againy Purchased many items to include a sweater and some yarn With her MOUNTAINMADE credit card. spent approximately $600.00 at the Vermont hat she wished to purchase for wanted to pay for it using the MOUNTAINMADE credit card. ended up purchasing the hat with her own, money at a different cash rediste: told [ Ito take whatever items jnad_purchased with the MOUNTAINMADE credit card home with them. did not take any but took some items to include a briefcase, some shoes and a hat. hdvised that in February 2006, saw a $500.00 artist expense charged that was questionable. This was when started comparing notes on[———] spending. recalled an Ineffective Management class that some MOUNTAINMADE employees took then recognized problems and put the blame on said that told| she was asked by to throw credit card receipts away. 5 At this point, (—____________]decided he Board and] took the lead. Felt that was the most trustworthy of the Board members. attended a meeting with the morning of the March 2006 Board meeting. wanted to attend the meeting but was not allowed. Instead; 1t was requested that each of the four write letters to the Board detailing their complaints about! said that during the Board meeting, | RINNE: apparently panicked after being questioned about MOI E finances. submitted her resignation the next day. and the other MOUNTAINMADE employees found out a few weeks Tater that was returning to her position at MOUNTAINMADE, According to| interviewed each of the complainants and explained to them there would not be any retaliation towards them. [_____] also gave each of them a letter stating there would not be any retaliation. Mollohan-841 b6 BIC bs bic be prc b6 IcD302 (Rev. 10-695) 58C-WF~233698-302 CContation of FD-302 of +0n02/21/2007__, Page __4. Once returned to work, was hired on a contract basis tO look into mismanagement Issues and interviewed_each employee. jare close be friends. ]informed WHat Her Issues were and told bc per anayt spending onthe Vermont trip. Subsequently, duties were reduced and a buying team was created consisting of also wanted Eo Join fon all buying trips. [-—“Jaavised that in November or December 2006, she notified that she did not feel like a part of the organization because she had been isolated. There was not any communication. On January 5, 2007, [——]was laid off along v6 with three others due to MOUNTAINMADE's efforts to become self- bre sustainable. The four individuals who were laid off felt they had a target on their back because they either complained originally or supported the complainants. tora she felt targeted because she supported the whistleblowers. was taking over the purchasing duties. joriginal understanding from[7——_]and was that MOUNTAINMADE could not buy inventory using Gage Income. Eventually, tor Pepe could uirchase inventory using Program Income. authorized fe use the Program Income and controlled how much Spen was told by[ ]that government money could v6 be moved from one quarter to another quarter. For example, if bre the quarter ended in January and had over spent by $10,000.00, the invoice would be paid the next_quarter and credit for it would be taken the next quarter. [— ]said that basically, MOUNTAINMADE would buy inventory in one quarter and pay it the next quarter. recalled two separate quarters when MOUNTAINMADE had not spent its budgeted amount so they pre-paid for inventory. If MOUNTAINMADE did not spend its budgeted amount, MOUNTAINMADE would lose that money. Also, MOUNTAINMADE wanted to keep receiving the same budget from the SBA. The company that MOUNTAINMADE pre-ordered from was HINKEL GLASS so when they received the product the next quarter it was already paid for. ([Ibeljeved that REP. MOLLOHAN was aware of all the bs issues with but it was kept quiet because it was an bre election year. MOUNTAINMADE staff received a memo to not Mollohan-842PD.302 Rev. 10-695) 58C-WF-233698-302 Continuation of FD-302 of |__| On 02/21/2007 __. Page discuss anything with the media. recalled jtelling MOUNTAINMADE employees during a meeting that "I will fire your asses if I hear you talked about issues", meaning internal re MOUNTAINMADE issues. me said that the night before the March 2006 Board meeting in Faizmont, West Virginia, she saw REP, MOLLOHAN having dinner with Jat MUTLEY'S BAR in Thomas, West Virginia. ((Jadvised that MOUNTAINMADE originally wanted to put a candle factory in the basement of the BUCKSTON & LANDSTREET building in Thomas. Since they could not put it down there, MOUNTAINMADE decided on putting a pottery studio in the basement. MOUNTAINMADE received a state grant and hired VANDALIA HERITAGE FOUNDATION (VHF) contractors to complete the job. The basement needed to be finished first before the pottery studio, The grant was for more than $60,000 and the be basement_was finis! [> —Jcomplained that they rai bie money. asked Jabout the pottery studio and told her that there never was going to be a pottery studio. elieved that the purpose for the grant was to increase the value of the building s: ind they were looking for a renter. heard say VHF needed another “gimp” to fill the studio. According to| went to Japan and China on separate business tring The receipts for the China trip were not provided by until after was no longer an employee, SJEGEHEd her receipts Into the new bookkeeper. = i pdvised that gave work from artists bre paid for by MOUNTAINMADE as a Christmas gift. said that she was told by atta the inventory database_was skewed by two CANAAN VALLEY INSTITUTE (CVI) employees. never got a chance to double check if the inventory was correct. bé BIC continued that REP. MOLLOHAN wanted MOUNTAINMADE inventary Fa decorate his office. when the inventory was signed out, created a sheet of fake sku numbers. When the inventory was returned by REP. MOLLOHAN it did not match with any sku numbers in the database. said the same situation occurred with the ALAN B. MOLLOHAN INNOVATION CENTER. Mollohan-843F028 (Rev. 1046.95) 58C-WF-233698-302 Continuation of FD-302 of +0n02/21/2007 _,Pags__6 __ Jadvised that told her she was Ere approached by fl 0 have MOUNTAINMADE buy property as an investment. did not think this pertained to MOUNTAINMADE's goals or mission. s_ told b that and a FNU LNU male came to and told her that if you take care of the inner circle, you will be taken care of. assumed this meant the inner circle of REP. MOLLOHAN. b6 said there was a conflict of interest that bre was ISFER CENTER (NTTC), the lof MOUNTAINMADE, and that NTTC hosted the MOUNTAINMADE website. continued that MOUNTAINMADE "paid out the ass" for the website. Mollohan-844D302 (Rev. 10-695) ale FEDERAL BUREAU OF INVESTIGATION date of birth: Date of transcription fe his home, residenc: lest Virginia [home telephon cellular telephon: The interview was conducted wi ie SPACE ADMINISTRATION (NASA) OIG SA After being advised of the identity of the interviewing agents and the nature of the interview, provided the following information: [~~ advised he was hired at MOUNTAINMADE as he was In September 2001 promoted toT after the 03/01/2007 b6 bic was fired fopnex inapitity to reconcile purchase orders. in January 2006 title was changed to junt id [was hired. ad] —TeftTe changed to, after was hired. was always in charge of inventory control and also handled the database. inventory. _ stated that when. inventory was missing, the auditors would address all employees as opposed to the employee who was probably responsible for the missing said_that during the time she was pressured provide receipts MOWNTAINMADE to on ua out , Sho: to get organized and to for purchases she made on behalf of was fired and said "don't trust the Board" tly afte: was fired, Jéo1d that! had contacted the Board of Directors regardin: fro learned this information ‘Oxmer MOUNTAINMADE employee and good friend of STRATION was th Might have more information. explained that when She talked about the inventory control problems and ow she was not able to get receipts for expenses fro [omer aise mentioned that she could not get SMALL BUSINESS (SBA) budget_information from took over as When, MOUNTAINMADE, she complained about also gave eacl overspending the travel budget. employee who had an AMERICAN EXPRESS (D6 [re 6 Bre 02/21/2007 Fie# 58C-WF-233698-302 “VO by SA # Elkins, West Virginia ate detted 03/01/2007 b6 “Th document contin nner ecommencalon nat cencusne of the FSI sth property of the FBI and ic leaned fo your agen, (and contents ee ct to be cetoued ous your spe Jo7G 2 .30Q bic Mollohan-845D302 Rev. 10.695) S8C-WF-233698-302 Contimstion of FD302 of +0n.02/21/2007 _, Page __2 charge, their bill and reques' xeciepts in an attempt to get for charges. questioned he company veRiGIé; a Subaru For: inventory, the to provide all of their to provide her receipts ow MOUNTAINMADE paid for their ‘rester. bé bIc Accopdina tal] wen iscues came up regarding from TOOTHMAN RICE would sigh and say "that's| [[—luwas told by that she had similar issues with manageme’ control. (——asvised that quarter even though the produ quarter. said the rea: in order to keep their fundin spend the money they were bud spent their budgeted amount f pre-pay for product to reach quarter. recalled tha business conference in North nt style and lack of inventory MOUNTAINMADE spent money in one v6 ct was received in a different bre son that MOUNTAINMADE did this was g at the same level, they had to igeted. If MOUNTAINMADE had not or a specific quarter, they would their budgeted amount in that t in 2005, went to a b6 Carolina and from there went on a bre personal vacation. MOUNTAINMADE paid for the entire trip. said that who worked in marketing for MOUNTAINMADE, was informe: wanted to with MOUNTAINMADE ii dt byl to do whatever he nventory. ‘° MOUNTAINMADE gave money to[——] to comp: also UNITED STATES REPRESENTA‘ far as[ ]knew, ne was not sure who paid for the said to that "we had g: give product to MOUNTAINMADE that Jnay have a this conversation. (i Jadvised that lete a project for MOUNTAINMADE and TIVE (REP.) ALAN B. MOLLO! ver completed the project work completed by! ven pre-paid money for woodwork to and REP. MOLLOHAN". advised bs dditional information regarding bre MOUNTAINMADE's website was produced by the NATIONAL TECHNOLOGY TRANSFER CENTER (NTTC), which was run by he MOUNTAINMADE Board of Mollohan-846,D302 (Rev. 10-695) (Conteustion of FD-302 of S8C-WF-233698-302 join in a meeting with| reque: he write a letter to the Board with his compli in rent to VANDALIA HERITAGE FOUNDATION (VHF) said that was hired On 02/21/2007 _, Page Directors. said that MOUNTAINMADE paid too much money for their computer services from _NTTC did not trust deta Ta Hot allow him to sted instead that aints. questioned the amount of money MOUNTAINMADE paid as around the same time that [ ]was hii red upstairs at the CANAAN VALLEY INSTITUTE (CVI). were friends. worked in the IT Department at CVI. Wi hen] e-mail wasn't working, assisted jin fix: everything was in working order. When obtained the computer system pa system in absence. Upon[ re’ ing the problem. Prior to the problem with| e-mail, KOMAR COMPANY came into MOUNTAINMADE and looked at all the, tems to ensure _ went on vacation, and worked on the turn from vacation, the MOUNTAINMADE website went down and determined that it was physically shut off. LNU from NITC happened and determined that someone from CVE off and had done other things to slow the sys by because he lost his temper with looked into what turned the_system tem down. obtained the logs that proved that someone from CVI ema! a complained to [Jad showed him the logs was fired jand another CVI employee, moved the MOUNTAINMADE database around which "skewe They manually mapped the inventory database t believed this could have been to cover Inventory since this distorted customer accou: MOLLOHAN and VHF employees and their purchase: was then hired by MOUNTAINMADE. advised that MOUNTAINMADE hi contract basis to build some items for the IN: SCIENTIFIC RESEARCH (ISR). MOUNTAINMADE paid| canceled the order with MOUNTAINMADE and neve: completed. I ]said that a sa a" the inventory. ogether afterwards. up missing ints to include REP. s and returns. red ona eee cee ISR x paid for the work laried employee at MOUNTAINMADE, also did made fixtures for the MOUNTAINMADE store. MOUNTAINMADE pail two to three times what MOUNTAINMADE b6 b7c b6 BIC be bre bs bic Mollohan-847D-3024 (Rev, 10-6-95) 58C-WF-233! 698-302 ‘Continuation of FD302 of, would norm: process ant ally pay for the items. d authorized payments to »0n.02/21/2007 _,Page__4__ s in charge of the was told by[ Jthat she had been approache that MOUNTAINMADE should buy some investment property. did not think it pertained to MOUNTATI fission, jalso told bé Bre by a member of the MOUNTAINMADE Board of Directors z or Jnct to trust advised that apartment by MOUNTATI switched i was wired in with MOUNTA: NMADE. After the March t so it was accounted fo: friend. gas and electric at her INMADE's meter so it was paid 2006 Board meeting, VHF x separately. ITAINMADE paid for| drove to New York with a be to bre was not sure of the specific date of the trip. advised tate a Eo me Mollohan-8484 _ e e FD 302 (Rev. 10-695) one FEDERAL BUREAU OF INVESTIGATION Date of transcription —_03/05/2007 bs For Surora Plight services, was interviewed at her bre Ortice, which Is located at~9950 Wakeman Drive, Manassas, Virginia, 20110. After being advised7t the ident: ie interviewing “agents, and the nature of the interview, provided the following information: [~_Jhas been employed as with Aurora Flight Services (Aurora) since Fin 2002, Aurora sought bids for construction of an additional building at the West Virginia Clarksburg Airport location. Several bids were placed including those from McCabe-Henley-Durbin and Management Assistance and Concept Corporation (MACC). The contract was awarded to MACC, whose principal was was not specifically recommended to Aurora by anyone in Bive, ent] Ln however, was a Clarksburg, West Virginia native, ani built the Northrop Grumman building, prior to being purchase Aurora in 1999. worked on the project for several months, but and Aurora could not agree upon a final price to complete the job. For this reason, Aurora changed from MACC to Jarrett Construction (Jarrett), which was owned by Aurora's bank, Huntington National Bank, (HNB) may have recommended although, the building project was 90% financed through state loans. were on site during most of the building construction. knew but had no personal dealings with either person, FTould sometimes call he office to ask for contributions for Congressman MOLLOHAN, but usually only spoke with In 2002, was THe for McCabe-Henley-Durbin, and at some point in the Bid process; Both came by the Auroza office to give 4 quote on the building, During the meeting, mentioned his wife worked for Vandalia Heritage Foundation (Vandalia) . also discussed the advantages of having a 501(c) company like Vandalia, construct the new building for Aurora. This was the only time[_—] ever met Inever had any dealings with the Mid-Ohio Valley Regional Commission. bic lnvestoaton on 03/02/2007 __# Manassas, Virginia mes 5ec-WE-233698-30 —"Ul ate deisted 03/05/2007 B bs by SA bIC ‘his document contains nelther recommendations nor conclusions ofthe FBI. Wis the propery ofthe FBI end is loaned to your agency, i and lie contents are not fo be eatibued outside your agency [ p7 cube y Mollohan-849sie e e FD 3024 (Rev. 10.6-95) 58C-WF-233698 Continein oc rDa020¢ _| 10s 03/02/2007 Pate 2 Near the end of 2003, [> left MeCabe-Henley-Durbin oe and went to work as at the Mid- Atlantic Aerospace Complex. | Twanted to sign off on Aurora's design and construction plans before construction started on the building. By June or July 2004, Aurora had closed on the building site. is described as follows Name: Sex: Race: White! Date of Birth v6 Home Address: bre NokeSville, vA 20181 Work Phone: Mollohan-850,D302 (Rev. 10-695) vile FEDERAL BUREAU OF INVESTIGATION Date of trnscipion 03/13/2007 was interviewed at bs Christopher's Banquet & Conference Ce 110 Van Kirk Drive, bre Fairmont, WV 26554, telephone number fter being provided the identity of the interviewing agent, provided the following information: advised that((______———sidjintroduced him and to UNITED STATES REPRESENTATIVE (REP.) ALAN B. 5 representative: hey met with the representatives at WILSON FORD DEALERSHIP. also attended the meeting. Prior to the meetina, nad said he was going to meet with REP. MOLLOHAN about company, SAFEDOC. Following the meeting bs at WILSON FORD and the request for a finder's fee for government bre contracts by REP. MOLLOHAN's representatives, [ to office to pay a bill for storage. talked to briefly about the meeting and showed no surprise regarding the request by REP. MOLLOHAN's representatives. The meeting seemed normal to also requested a finder's fee for the introduction to 5 's representatives. recalled that he andl used a couple computers to include @ laptop which took with her when she left. dvised that has a very good memory. called after he was initially interviewed by the FBI to determine If she remembered the name of the outside consultant they utilized while starting the company. recalled the name of the company 6 being PETEK or something similar. Once mentioned the name bre PETEK, said she would not discuss the subject with him and neither a nor denied that PETEK was the correct name. said that originally found PETEK to assist them and that it was a government funded agency located in Pennsylvania who assisted small businesses. described the individual from PETEK who helped them was around[_] years old and owned a tuxedo company. This individual told them he had seen_businesses fail because they agreed to pay bribes and kickbacks. recalled meeting with PETEK at DJ'S DINER by the airport in Fairmont, West Virginia. advised that the first person he spoke with from REP. MOLLOHAN’S offices was a female. Jcould not recall her name. Invetigaton om 1/11/2007 __« Fairmont, West Virginia ee File # S8C-WF-233698-302 -Tpv Date dictsted 1/23/2007 by SAL “This document contin neither recommendations nor cnchsions ofthe FBI. Its the property of the FBI and is loaned to your ag it ands contents are nt to be distributed ouside your SSP PI SCI SOR Rollohan-851oe e e FD.302s Rev, 10-698) 58C-WF-233698-302 Contimation of D020 __| On 1/11/2007 Page said thad kept a work calendar but was not. sure if ifwas-on the computer or on paper. was not sure of the person's name from MANTECH who had told him previously that if they actually moved out of the INNOVATION CENTER, it would be "the demise of our company. We would not get anymore government contracts if we moved out." guessed that his first name might have been advised that| was the Superintendent for MASSARO CONSTRUCTION on the construction of the WEST VIRGINIA HIGH TECH CONSORTIUM FOUNDATION moun) /iNSTITUTE FOR SCIENTIFIC RESEARCH (ISR) building. was asked to incur all the costs for one year without payment from WVHTCF/ISR. said that POCKET MANAGRENT SERVICES filed for bankruptcy_and was sold to phonetic), who was a former employee of ADI TECH, an imaging company, and a recreational vehicle dealership on Goshen Road. advised that the interviewing agent should contact the West Virginia Department of Highways, Engineering Department to obtain the book listing the properties affected by the location o the I-79 Connector. [ ]said that the name Showed up numerous times. bé bic bs b7c be prc Mollohan-852: e e D302 (Rev. 10-695) ale FEDERAL BUREAU OF INVESTIGATION Date of ranscption _03/02/2007 ‘security number: date of birth: was interviewed at her home Fesidence Martinsburg, Wes: ‘inda ‘Also conducting the interview was SA Pittsburgh Division, Martingsburg RA. After being advised of/the identity of the interviewing agents v6 and the nature of the Anterview, provided the following bre information: said that initially the SMALL BUSINESS 5 ADMINISTRATTON (SBA) grants went through WHEELING JESUIT ng UNIVERSITY who would get 10% of the grant. Eventually ae 4 MOUNTAINMADE broke off and became their own entity. Jwas_the JMOUNTAINMADE but was fired after_confranting regarding a conflict of interest. was on the Board of Directors of MOUNTAINMADE and was the NATIONAL TECHNOLOGY TRANSFER CENTER (NTTC) who was the vendor MOUNTAINMADE used for their website. took over a: and she asked to become the bookkeeper. was trained by [ From TOOTHMAN RICE on her duties as bookkeeper. Tyas the bookkeeper ch 2003 to October 2004. switched banks while was bookkeeper. bs [ Jadvised that| went to New York on a ea personal trip and charged it fo the credit card that was tied to the line of credit at the bank. was constantly traveling. had to "bug" for receipts for her trips and purchases. Imesigaen on 02/23/2007 _« Martinsburg, West Virginia Fe# S8C-WF-233698-302 -TH ute dettes 03/02/2007 by SA bs bre ‘Tis cecumert ensns reer ecommenstns oor concise of the FL I the popey ef the FB ad saad to your apne, "a te rn ent obo nce oss yor ery a= weer Mollohar-853 ToTse2 SodFDA02 (Rev. 10-695) 58C-WF-233698-302 CContamation of FD-302 of +0n.02/23/2007 __, Page said that she was just about to get her knee replaced afd Was setting herself up to work from home during her eocovery, dian (ate (mele: cea) oy xan] eric vce paimenserior tne Board ecto: contractor for MOUNTAINMADE. The reason[ gave x her being fired was that she could not write grants. made it clear before she was moved to bé bookkeeper that she was not able to write grants. prc While she was still an employee at MOUNTAINMADE, she contacted the Board of Directors asking why and hot could be on the Board. advised that on her way out.the door of MOUNTAINMADE, she told "don't trust When asked, said she did not recall if she approached bout spending and other issues. continued that if she did go to a Board member to complain, it would have been| since she found her to be the most approachable. b6 had not had any contact with MOUNTAINMADE bre employees since she left, except} |. did not recall any money that MOUNTATNMADE xeceived from VANDALIA HERITAGE FOUNDATION (VHF) . recalled talking to a female who worked i bs advertising about the issues she had with could bre not recall her name. said that [ ] worked upstairs from MOUNTAINMADE at CANAAN VALLEY INSTITUTE (CVI). When originally got the position as. MOUNTAINMADE, the opening was not advertised. Mollohan-854ty F302 Rev. 106.95) be Bre ole FEDERAL BUREAU OF INVESTIGATION Dale of trmseition _01/10/2007 social Security number was. interviewed at her home resfdence of[ West Virginia telephone number “Biter being provided the ifentity of the interviewing agents, provided the following information: cc bé bye Buckhannon, West Virginia. continued that Jwho_owned his own cle by accounting firm, handled their year end audit. was, fo recalled that the grants MOUNTAINMADE received from the SMALL BUSINESS ADMINISTRATION (SBA) were from October to October each_year. MOUNTAINMADE would make draw down requests quarterly. helped track the budget versus amount spent for the grants but did the final reports to the SBA. (7 7]said she recalled the fpllowing people a MOUNTAINMAD! LNU in receiving, LNU and INU who would open mat. According to approved the invoices and that purchase orders were generated for the invoices. MOUNTAINMADE did not have accrual invoices, they only paid for products they had already received. MOUNTAINMADE never paid for products they had not received and the earliest MOUNTAINMADE would pay was upon receipt of the product. advised that| had a bank debit card for a MOUNTAINMADE account that was used el funds or when she purchased items for the showroom. LNU, who worked in IT Investigation on 12/7/2006 st West Virginia : Fie # 58C-WE-233698-302 ~14 Date dicated 1/9/2007 SA wy. SA bé bic b6 b7c bé bic ‘This dosamentcortans nhs resmimenatons nor conetisions ofthe FEL. 1 the propery ofthe FBI and is loaned to Your ABER it and is contnts are not to be distributed outsido your sgeny. FISH. BOQto e e FD.302« Re, 10-695) 58C-WE-233698-302 Contmation of FD-302 of 1On 12/7/2006 __,Pee _2. for MOUNTAINMADE also occasionally used the card to order computer related items. According to she was a couple_of weeks shy of her bs yearly contract renewal when she was fired bi said bre she "did not mesh well" with stayed at MOUNTAINMADE for another_two weeks and trained who took over her position. was in_charge of the MOUNTAINMADE Country Store. As far as knew, was currently doing the bookkeeping. Jdvised that the e-mail she received fro telling her-to "Call Me!" was regarding a report for the Board of Directors. aid that liked the work that had) done which _is wh e-matled asking what_had happened regarding contract not being renewed by re said that she was not aware of any accounting issues at MOUNTAINMADE. MOUNTAINMADE leased property from VANDALIA HERITAGE FOUNDATION (VHF). While was the bookkeeper, MOUNTAINMADE did not receive any money from VHF. Mollohan-856,DA02 (Rev. 10-6-95) ale FEDERAL BUREAU OF INVESTIGATION Date of tansoripon _02/27/2007. socjal security number| was bs interviewed _at Ais home residence: a) : Elkins, West Virginia 26247, home telephone: ] After being advised of a identify of the interviewing agents and the nature of the interview, provided the following information Co CJ [sre co bowel said that could not be trusted. was brought in to fix the problems at MOUNTAINMADE. During a staff meeting, [__]told everyone that the issues at MOUNTAINMADE and with[_———] were to be kept "in house". did not want employees to be seen with coworkers in Public because she was worried someone might over hear conversations about MOUNTAINMADE. jalso not to ee talk to anyone about the issues at MOUNTAINMADE. felt his job was in jeopardy if he did speak with anyone, MOUNTAINMADE employees were also given script sheets to follow if they received a call from the media. The procedure ended after the November 7, 2006 election. were to handle any calls from the mediay advised the relationship between MQUNTAINMADE bs and VANDALIA HERITAGE FOUNDATION (VHF) was strange. bic heard talk of a pottery studio going into the BUCKSTON-€ LANDSTREET building. MOUNTAINMADE used money to finish the of the building but did not put a pottery studio in. felt it was finished so that VHF would have a finished basement since they owned the building. resign oo _02/09/2007 _# Elkins, West Virginia res S8c-w8-233698-309 15. Dato deated 02/27/2007 bs by SA bre “Wie coouret carne neta resonant rar conn of the FB, the propery he FB and ose your sen ian cots ea fo beetle ee Jour 20a. 9753.32 Mollohan-857y e FD-3024 (Rev, 10-6-95) 58C-WE-233698 Continuation of FD-302.08 __| According t MOUNTAINMADE never received any benefit from China. erips, specifically her trips to Japan and controlled the subpoena compliance at MOUNTAINMADE. The Follo' employees all helped with mal copies for the subpoena: recalled that MOUNTAINMADE had already received ,an_inyoice prior to receiving product from HINKEL GLASS. as the truck driver who picked up the product. 0n02/09/2007 _,Page__2 b6 bIc b3 b6 Ie bé bIc Mollohan-858Pr @ e D302 ev. 10-695) ie FEDERAL BUREAU OF INVESTIGATION Date of tasespton _02/13/2007 soci4l security number was interviewed at her home residence: | E After being advised of the id e interviewing agents and the nature of the interview, povided the following information: l 1 be [ bre | | — h said that was only in the office for approximately 20 hours per week. Koll Ithat one of her main responsibilities was to keep on track. Whiel was she was often asking for re expenses she charged on her MOUNTAINMADE debit card, [~~ "“fwould tell her they were in her apagtnent end eventually brought in a box of crumpled receipts. felt that 4, some of the expenses were for! personal use. listed 3), them as follows: AVEDA BEAUTY-$600, EILEEN FISHER (Clothing Store)-$1,300, s in books, and also expenses for personal trips. accounted for any questionable items by placing them into the Program Development general ledger account. explained that Jwas frustrated with] and had numerous conversations will labout using the MOUNTAINMADE card for personal expenses. stated that it was illegal for to charge for personal items. recalled numerous expensive dinners thai would charge, including a $700 dinner with the Board & ors. Investigation on _ 02/09/2007 _w Elkins, West Virginia e# S8C-WE-233698-302 ~]0 Date dioated 02/13/2007 bé ty _ Si bre “This document contain neither reommendstions nor of the FBL I is the property ofthe FBT and i loaned to your agsgy ‘and is coneats ae not 1 be Grbued sie yo Mollohat-859 77S a.30>.FD3028 (Rev. 10-695) Continuation of D302 of 58C-WF-233698 +0n 02/09/2007 _, Page According to Left MOUNTAINMADE about five weeks after started as called ‘So her contract was not renewed. advised that wa. jout during staff meetings. had time efficiency issues bs the first bre bookkeeper she could remember, then helped with deposits when there were lapses of bookkeapers. MOUNTAINMADR's accounting fim, TOOFHMAN RICE handled some bookkeeping duties as well_and were aware of mis-spending. said that_when discovered that [ time between was mis-spending, she went to was subsequently fired. owned the SHGACE BUILDING and let(_—__] live explained that VANDALIA HERITAGE FOUNDATION (VHF) rent free and that it was a rent to own agreement. MOUNTAINMADE paid forL___] Be utilities for awhile but that was stopped. VHl apartment next to| apartment for Board F refurbished the ie member, during the Board meetings. It was a two bedroom but friend, [~~] lived there rent free. bal warning was told byf to give about her performance and time spent at work. personal expense and her issues obtaining rece: was working ey TS was ‘oid[—Jabout the two 10 hour days since we ing to colleg previously approved b, then t issues she had with| Spending MOUNTAINMADE funds for ipts. mentioned this to fellow MOUNTAINMADE oyees who also had issues wit ey decided age SMALL BUSINESS ADMINISTRATION (SBA), where the from because they did not want to hurt MOUNTAI to call who was on the Board, be the most trustworthy. called who UNITED STATES REPRESENTATIVE (REP.) against it. jot_in touch with fellow ainst telling the grant money came NMADE. They decided cause he seemed to be bé wanted to call bre MOLLOHAN, but decided Board member and ttorney. wanted to meet with about the situat: ir next Board meeting. anted to was not allowed, instead each of the four, each wrote a grievance letter for the fon the morning of Board. jadvised that| attended the Board meeting that ght as her meeting wit! heard that the Board talked to about her travel Mollohan-860,D304 (Rev 10695) Contimtion of FD 302 of S58C-WE-233698 +0n 02/09/2007 Page reports. The next da’ sent her resignation via e-mail to the Board and for MOUNTALNMADE. b6 called[ Jand told-her to tell everyone that resignation 7c was not accepted. also said he did not want anyone talking about what was going on at MOUNTAINMADE. This was around the same time the FBI's investigation into REP. MOLLOHAN was announced in the media and when the head of the INSTITUTE FOR SCIENTIFIC RESEARCH (ISR) resigned. took a three week leave of absence/vacation. advised that after] returned to work, was told to meet with to find out what expenses on the debit card were personal expenses that would pay back to MOUNTAINMADE . did not pay any money for the thousands of dollars in books and art work, to included $3,000 spent at HANDMADE IN AMERICA which was in her office briefly then disappeared. also did not claim any of the dinners. bIc said that[ Jwas not acting professionally towards the staff to include_only responding ployees via e- mail, no verbal responses. contacted via e-mail regarding whistleblower protection. aid not respond immediately but eventually did reply. According to [was called by| Jana said he wanted to talk to each of the four employees who wrote the grievance letters: said he will protect them from any retaliation byL_____Jand went over their letters and other issues. [______]handed each of them a letter stating there would not be any retaliation for bringing their issues forward. few weeks later, around April 15, 2006, be MOUNTAINMADE Bre brought in lon a contract_basis to make changes in management... was a friend of [ Jand worked for WEST VIRGINIA UNIVERSITY said she did not like REP. MOLLOHAN or the Board. [changed everyone's titles and forced out of MOUNTAINMADE to work at the Country Store. hired as land said he was fine with one day per week Dut eventually changed his mind. was working last day at MOUNTAINMADE was in August 2006. filed for unemployment and won the trial but received no money since she was going to college which limited her work hours. Mollohan-861e e D328 (Rev. 10-695) 58C-WF-233698 Coniston of F302 of| 0a 02/09/2007 _,Pase advised that and herself are filing a lawsuit under the False Claims Act against the Board, and MOUNTAINMADE. lsat the lawsuit will be filed sometime soon. The four Individuals have kept the lawsuit private. bé bIc was told by| that the SBA and the WEST VIRGINIA DIVISION OF HISTORY do not pay attention regarding how MOUNTAINMADE spends the grant money. recalled MOUNTAINMADE receiving a grant for $95,000 to build a pottery studio in the basement of the BUCKSTON «& LANDSTREET building, which is owned by VHF. knew that MOUNTAINMADE going to build a pottery studio and thought it was a fraud. fe Sonica that the real purpose for the grant was to improve the Value of a building owned & VHF. Once_it was a realized there would not be a pottery studi Jaske g about how the money was used. Jtold| that the grant was just for the first step a Lae. ling a pottery studio, which made it_acceptable that the pottery studio was never completed. As far as| knew, the basement was not used for any purpose. advised that had the document they each were GIVER by stating not to say anything regarding issues at MOUNTAINMADE until after November 8, 2006. REP. MOLLOHAN was up for re-election and voting took place on November 7, 2006. oe explained that took separate trips to Japan and China that were supposed to a business trips. [1 said that never reported anything to the employees 0: MOUNTAINMADE and did not see any benefit to MOUNTAINMADE. jwent on a personal vacation to SNOWBIRD LODGE and charged TEES -HOUNTAINMADE aid that] was put on the Board to be REP. MOLLOHAN's eyes and ears. continued that REP. MOLLOHAN knew everything that happened at MOUNTAINMADE but did not have proof of this. bs b7c jadvised that filed a grievance against MOUNTAINMADE and sent a copy of the grievan REP. MOLLOHAN also filed a grievance against Mollohan-862PD-302 Rev. 10-695) FEDERAL BUREAU OF INVESTIGATION Date of transcription _04/12/2007 date of birth social security number’ J telephone number, is interviewed at his home, which is located at Huntington, West Virginia, 25702, Also present during the SHESEView was United States Department of Commerce (DOC), Office of the Inspector General (OIG), Special Agent After being advised of the identities of the interviewing agents and the nature of the interview, provided the following informatio: Co Since 1995, five (5) EDA grants have been awarded to the West Virginia High Tech Consortium (WVHTC). The first grant was issued in 1995, which consisted of $1.864 million dollars for land sub surface stabilization that needed to be completed as a result of strip mining. EDA contributed 80% of the total grant cost, which amounted to $1.44 million, The remaining matching funds or guarantee came from wvaTc. [L___] did not know what was used as a guarantee, but stated the guarantee must be from non-federal funds| The’ second grant was issued in 1996 for a fiber optics project for a total project cost of $1.229 million. EDA contributed .976 million. A third grant issued in 1999 for a total cost of approximately $182,000 was awarded for engineering and design work. A fourth grant for a site development was also issued in 1999 for a total cost of $2.9 million. EDA contributed $2 million. The fifth grant was given in 2003 for a total cost of $2 million for site work on 20 acres of land and site stabilization for three (3) buildings. EDA was to contribute $1.2 million were submitted to through the Regional Planning Council which followed EDA procedures. The pre-application for the fourth grant in 1999 along with the 2003 grant were sent or mailed directly to The pre: poetigacion paperwork for the first 2-3 grants Investigation on 04/11/2007 _a Huntington, West Virginia File # 58C-WF-233698-302 ~77 Date dictated 04/12/2007 by _SA ‘This document contains nelther recommendations nor conclusions ofthe FBI It is the property of the FBI and is losned to your agency: iad is contents ave no tobe daibted ouside your Mollchan-863 jotecal.30Q be Ic Be 7c L b6 Ic b6 pict pM FD3028 Re. 106-95) 58C-WE-233698 Continuation of FD302 of »0n 04/11 2007 Page _2. During either fiscal year 1999 or 2000, $3 million was set aside from a flood disaster relief fund for the 1 Virginia Congressional District. $1 million from thi sent to Paw Paw, West Virginia for reconstruction eff of the remaining $2 million was to be decided by Cong MOLLOHAN. DOC jasked MOI $2 million could instead be used to fund a project in MOLLOHAN agreed with the understanding that the $2 mi. Puerto Rico would be nace! at a future date. Some st West s fund was orts. The use ressman| LLOHAN if the Puerto Rico. lion sent to time’ after this conversation, left the DOC but allegedly never informed anyone at EDA of his promise to MOLLOHAN After left the DOC, MOLLQHAN contacted EDA about the $2 million. informed (OLLOHAN that had never heard of such an arrangement MOLLOHAN telephoned L Jon August 2, 2000 to see if would confirm this information to nformed MOLLORAN that had only heard about this promise from [through MOLLOHAN, and that it was never conveyed directly to MOLLOHRN_bacpne extremely angry with and MOLLO! called again. Prior to that day, ie was not um MOLLOHAN to periodically call[_____]to discuss variou: the Ist and 3rd Congressional Districts of West Virgi was always very supportive of the EDA. Eventually MOLLOHAN was able to obta which went to Vandalia Heritage Foundation end Py was used to renovate an opera house in Thomas, West V: According to this $2 million was the "biggest dollars that I’ve ever seen." knew the 1999 EDA grant (number 01-01 awarded to WVATC million had something to do w: development, but knew little else about this pa: HAN never usual for s grants for nia. MOLLOHAN $2 million, believed it irginia. waste of EDA -03903), ith site ticular grant. Grant pre-applications were normally prepared by the Regional Development Council, but the application for this grant just "showed up". MOLLOHAN never contacted abo but MOLLOHAN was involved in the selection oF this sii ut this grant, te because he wanted it to be visible from the interstate. [_——]never solicited or endorsed this particular grant, and reluctantly si the application. [(__]believed WVHTC had received et money through the first 3 grants to get started, and this grant along with the fifth grant issued in’ 2003 never heard of the Institute for Scientific Research after this grant had been approved, and ISR was made gned off on nough grant a opposed had (FSR)_until a co=grantee. b6 pyc b6 7c be bre Mollohan-864five 1 rosin te.0695 ® @ ‘Continuation of F302 of ,0n.04/11/2007 _,Page_ 3. PE 58C-WF-233698 bic did not know of the $375,670 new appraisal difference of a State funded road that was used as an in kind contribution to match the 20% cost share for this grant. In addition, [7—]was contacted sometime in 2001 by Of Thomas, West Virginia, work phone, nformed that Congressman MOLLOHAN and a partner purchased land in Tucker County, West Virginia, which was located adjacently to an industrial park, immediately after an EDA grant had been approved to improve the land. The grant was bs issued in 2001 for the Tucker Development Project, located in bre Davis, Tucker County, West Virginia. provided a list of the EDA district offices, and a handwritten note detailing the five grants issued to WVHTC from 1995 until 2003. These items will be maintained in a 1A envelope. Mollohan-865,rosmae0559 e e ie FEDERAL BUREAU OF INVESTIGATION Date of transcription —_0.4/11/2007 cial security number[ | dat [ was Interviewed at her nome.zesidence [rwagnington, DC “Z0003, “cellular telephone: Biter Yeing advised of the identity of the THTerviewing agents ang the nature of the interview, provided the following information: be | ere =| said she had power of attorney over REP. o MOLLOHAN's bank accounts but it became overwhelming so she transferred the responsibility to who handled the accounting at the Ram in Morgantown, West Virginia. At the time of the interview still handled the banking for two of REP. MOLLOHAN's accounts at the Congressional Federal Credit Union. »é ran the Summit PAC for REP. MOLLOHAN, which she described as »7¢ Very stall with only one fund raiser per year. handled the Federal Election Commission (FEC) filings for REP. MOLLOHAN. According to her salary for her work as personal secretary was $67,000.00 and she also earned a salary of approximately $25,000 per year for her work on REP. MOLLOHAN's ‘Summit PAC. [__—] earned $50/hour for her work on the Summit PAC. wrote the checks to herself for her salary since she controlled the Summit PAC bank account. worked at home on the Summit PAC and the_work on the Summit PAC was limited to only nights and weekends. utilized a campaign finance software. — advised she did not own any properties with REP. MOLLOHAN. REP. MOLLOHAN gifted money to so she could purchase some property in Bald Head Island, North Carolina. said that she is closing on the property sometime in April or May 2007. planned to "flip" the property and not rent it out or Investigation on 02/28/2007 __# Washington, DC y ‘This document contains neither re it and its contents are not to be dit File # S8G-WE-233698-30; ¥ Date dicated 03/07/2007 SA SA, bé bic FBI. It isthe property ofthe FBI and is loaned to your agency; fe your - TY 130d, Mollchan-866,Continuation of FD-302 of “stat 0698 e @ 58C-WE-233698-302 live in it. did not have a signed agreement On 02/28/2007 __, Page with REP. b6 MOLLOHAN to répay the monies given to her by REP. MOLLOHAN. The 7c purchase price of the property was $299,000 and she made ia soup payment of $15,000. REP. MOLLOHAN transferred $12,000 to and she wrote a personal check for the down payment. said she had paid back $3,000 to REP. MOLLOHAN via personal check. the ROBERT H. advised she has been involved with MOLLOHAN FOUNDATION (RHMF) since 2000. was currently on the Board of Directors. assisted in the planning of the golf tournament, was not as active since she moved from West Virginia. Said she had no financial ties regarding her involvement with REMF. explained she knew but b6 did not deal am with in her capacity as a staffer for REP. MOLLOHAN. There were Other staffers who worked with said that HELEN HOLT MOLLOHAN (HOLT), REP. MOLLOHAN's mother, gave a lot of money to REP. MOLLOHAN. HOLT was a millionaire. HOLT would routinely wire money to and described HOLT as very healthy. peau refinancing deals and through his ownership REP. MOLLOHAN b6 Bre advised that REP. MOLLOHAN made all of his money in Remington, listed REP. MOLLOHAN's investments to include 401k, oil and gas bonds, and IRAs. According to had a longstandin: relationship with REP. NOLLOHAN and REP. MOLLOHAN's was empl, MAAC in Parkersburg, West Virginia. sure of actual duties. made out to herself for her own salary, signed them (See b6 Ic was shown copies of Summit PAC checks that she herself, endorsed the back of the check, and deposited into REP. MOLLOHAN's account at the Congressional Federal Credit Union. The check numbers included: 171 $3,550.00 180 $1,150.00 184 $ 600.00 185 $600.00 226 $2,450.00 238 $2,050.00 Mollohan-867“pont 19685 e @ Conimusionor=D-sozet __| +n 02/28/2007 Pree (7 Jadvised that she wrote and signed Summit PAC checks, endorsed and deposited the checks into REP. MOLLOHAN's account, jately had the money wired to her personal account. explanation was she did not have the funds to cover the deposits and the Congressional Federal Credit Union had a five day wait before being able to use the money deposited if there are not enough funds to cover the deposits. needed the money sooner than five days. lwas not aware of there being any issues with this process. said that REP. MOLLOHAN was not aware of this practice. explained that MNM HOLDINGS was created to handle the assets fax REP MOLLOHAN' tate Mi i fthe three children of According to MsM PARTNERS was made up of REP. MOLLOHAN and [ did not. very well and had no dealing with company. had no information about MeM PARTNERS. said that there is one property in Bald Head Island that is owned jointly by REP. MOLLOHAN and where REP. MOLLOHAN is making all of the payments. The property 1s currently up for sale. from the Ramada Inn was working these accounts. jadvised she was not aware of any other business artnerships that REP. MOLLOHAN had other than REP. MOLLOHAN's wife, BARBARA was included in the rental Management of the Remington properties in Washington, DC. The finances for the Remington properties is being handled by explained she was not involved in the construction gf the garage apartment on REP. MOLLOHAN's property in Felrpont West Virginia. There was a separate bank account set up b: that was funded by REP. MOLLOHAN for payment of the construction. recalled wiring time only payment of $15,000 from REP. MOLLO! "s account so could pay for some of the construction. did not recall ever writing checks on REP. MOLLOHAN's behalf to this account. said there were numerous tenants in the garage apartment to include ENU. and possibly one of REP. MOLLOHAN'’S stayed for a couple of months. be bre be bre b6 Ic bé bIc Mollohan-868“wostatn 18695 e 58C-WE-233698-302 Continution of F902 of 102 02/28/2007 Pree advised that REP. MOLLOHAN and owned five or six properties together and had sold either four or five roperties. did _not know why did not have any money. continued that, possibly owes oversight. REP. MOLLOHAN always submitte: assisted in the preparation of the FDRs. some attorney fees. explained that REP, MOLLOHAN did not file the Financial Disclosure Reports (FDRs) properly due to a mere his EDRs early. did not write the 200 page addendum. There are numerous copies of the addendum available in REP, MOLLOHAN's office. recalled a nonprofit summit approximately four years ago where each nonprofit provided: the steps they were taking to become self-sufficient. bé Bre be BI Mollohan-869" ° e D302 (Rev. 10-695) FEDERAL BUREAU OF INVESTIGATION Date of transcription 04/24/2007 cellular telephone number contacte via telephone and provided the following information: & advised that was in charge of the Woodlawn Cemetary In Fairmont, West Virginia. Woodlawn had been under charter for 150 years and there are two or three former Governors of West Virginia buried at Woodlawn. Woodlawn was prominent until the 1970s because it had a Caretaker living at the cemetary. when there no longer was a Caretakers Handa went into disarray. Approximately ten years ago, was asked to take over Woodlawn. took over as lof the Board of Directors and—Ted-the way to raising money to pay for all the fees associated with Woodlawn. Recently, petitioned a judge to allow her and her associates to take over Woodlawn because she claimed that no one was running the cemetary. ssociates included a total of six people who came from different states, including New Jersey. The group also included[_____], who used to own the Hutchinson house before he sold it to VANDALIA HERITAGE FOUNDATION (VHF). [——Jalso has a son who is employed as an attorney at WEST VIRGINIA HIGH TECH CONSORTIUM FOUNDATION (WVHTCF) . A few months ago, a hearing was held and JUDGE FOX xuled to overthrow the Board of Directors of Woodlawn and made group the trustees of Woodlawn. felt that all of these individuals were puppets to UNITSD STATES REPRESENTATIVE ALAN MOLLOHAN. advised that could be reached at twesigstn en _ 03/26/2007 _t_Falls Church, Virginia (telephonically) Fie# 58C-WF-233698-302 ~74 ae dewted 04/02/2007 y SA ‘is document cara nti ezammendsons re concen othe FEL Ie te per ofthe FBI and ie ose 6 yer agen b6 bic bé bre bé bic b6 bic Wand is contents ve nat te dtd euo your agency [ } AS |. 303. Mollohan-870ale F302 Rev. 1046.95) FEDERAL BUREAU OF INVESTIGATION Date of transcription _04/24/2007 former General Counsel to VANDALIA bs HERITAGE FOUNDATION and VANDALIA REDEVELOPMENT CORPORATION bic (VRC), contacted SA via telephone and provided the following informationt expressed concern over the following information and has felt uncomfortable with the situation from the moment it happened. The following is in regards to the production of the response to the Grand Jury Subpoena that was served regarding the investigation on UNITED STATES REPRESENTATIVE (REP.) ALAN MOLLOHAN. Gc 3 bé bIc ba bs bre imertgson co 04/12/2007 _# Fairmont, West Virginia (telephonically) fet 58C-WP-233698-302 - FO ae deated 04/24/2007 by _ SA a bre "Wis dosent cons nna neonmentans rr conus che Ff the pope of the FB nd sone to your agen, Wand i carers ste ol to be ceibuted cli your agency. Lp 149.305. Mollohan-871a erate e e 58C-WE-233698-302 Contcustion of FD-302 of ,0n_04/12/2007 _, Page listed the following as individuals who worked at the Highgate Carriage House on the production of the response to the Grand Jury Subpoena: bs bE Bre aid-that was now an employee at STEPTOE & JOHNSON, Mollohan-872a e@ e FEDERAL BUREAU OF INVESTIGATION 04/24/200° Date of transcription date of birth West Virginia 26554, ce. interviewed at the FB1 offices of the Pittsburgh Division, Clarksburg Resident Agenfy, 320 West Pike Street, Suite 310, Clarksburg, West Virginga 26301, After being advised of the identities of the interviewing agents and the nature of the interview, provided the following information: Fairmont, was b6 7c [stated that she never attended any Board of Directors meetings and had limited dealings with recalled that the first time she met UNITED 6 STATES REPRESENTATIVE (REP.) ALAN MOLLOHAN was during a company bre meeting where she was part of a financial presentation for REP. MOLLOHAN. [— specifically remembered a statement made b REP. MOLLOHAN; it was "How you do finances defines you." stated that the finance department at ISR made framed posters with that comment and hung them in the finance department. stated that she destroyed the one she created after she ead about the investigation on REP. MOLLOHAN. According to she handled invoices during the early part of her career at ISR. ee that ISR purchased land from WEST be VIRGINIA ‘CH CONSORTIUM FOUNDATION (WVHTCF) as the site bIC overheard ISR General Counsel| talking about the appraisal for The value of the land was was not sure how they for the ISR building. ing a tora. determined to be $910,000 but determined the value. vestigation on 04/10/2007 __a Clarksburg, West Virginia Fie# 58C-WE-233698-302 -G\ Date dictated §— 4/23/2007 3K bs eee BIC “scout corals hs racmancaons nor ence he FB Wis he pope fhe FB an cae to yur apne: Tan wo cote ae nate be inte ete Your 29 Mollohar-873 TISZ BODD302 (Rev, 10-695) 58C-WF-233698-30: 2 CContimation of FD-302 of According to WVHTCF had received a $2,000,000 grant from the D: Administration ( the land. The pt was needed prior money and EDA ag: epartmen Commerce, Economic Development EDA) about two years prior to the purchase of urpose of the grant was to clear the land, which to any construction. WVHTCF did not use the weed to re-issue the grant provided ISR was made a co-grantee, which happened in February 2001. The grant passed through ISR, who handled all payments to vendors and requests for reimbursement from the EDA. $2, 000, 000 gran part of the cons’ was placed into (WRC) . ex) stated that ISR also received an initial from Housing and Urban Development (HUD) as a truction of the ISR building. The $2,000,000 escrow with VANDALIA REDEVELOPMENT CORPORATION (plained that ISR or someone involved with ISR wanted EO get VRC involved. The HUD money was held in escrow building. ISR at the during the cases of land, prior to construction of the ISR ime, believed that made the decision to put the money Into escrow. jadvised that ISR initially utilized their line of credit to pay the vendors during the clearing of the land, then ask for reimburs: was established, ement from the EDA. Once the escrow with VRC ISR used that money to pay the vendors. stated that the main contractor for clearing the land was $2,000,000 that CONTRACTING. ISR borrowed money from the was held in escrow by VRC and paid CENTRAL using the invoices provided for work completed. ISR sent the invoices to EDA for reimbursement, which was at a rate of 708. For example, if ISR reimburse ISR $71 submitted an invoice for $100.00, EDA would 0.00. ISR then placed that money back into the escrow held by VRC. advised that the HUD grant money remaining in escrow was ¥el@ased to WVHTCF. WVHTCF de net incur any expenses for the clearing of the land so could not understand why WVHTCF was paid any of the money from the escrow. The first payment was $1,200,000 and the second payment was approximately $7 ‘50,000. could get @ $2, advised that she could not understand how ISR 00,000 grant from EDA to clear the land and also receive a $2,000,000 grant from HUD to use to pay expenses in the clearing of the land. During a period of eight months, the +0n.04/10/2007 _, Page bé bic b6 Ic b6 bic b6 7c Mollohan-874org e e 58C-WF~233698-302 Continmtion ot FD-3020¢ __f On 04/10/2007 __, Pree following individuals met monthly to discuss financials issues related to ISR: At the time Jwas a Partner at TOOTHMAN RICE, the Public accounting firm hired by ISR and WVHTCF, At the time of the interview, was the| lof WVHTCF. At each of the meetings, this Sitwation was discussed and ould explain 6 why there are ne issues with receiving the Ov grants. Do] bre believed that it must have been acceptable since nad told them it was okay. explained tha’ finally decided to create a Powerpoint chart using the information provided by[ Fo help them understand how the flow of money worked. provided a paper copy of the Powerpoint chart. [[—hrecalled that during ion of the ba xesponse to the Grand Jury, Subnaa: did a "happy bs dance" when they found the feat created bre an ands regarding the use of both stated that WVHTCF also had approximately $80,000 in expenses for the land clearing prior to receiving the EDA and HUD grants. WVHTCF was reimbursed for that amount as well. advised that Jtold her he f REP. MOLLOHAN and asked him “what are we doing?" told| that he thought it was money laundering and that he bs stated this to REP. MOLLOHAN. bic believed that the government paid $4,000,000 for property that was worth less than $1,000,000. stated that herself, knew this whole process was "shady". ecalled that attempted to address their cOncerns with the Board of Directors at ISR. Neither both members of the bs Board of Directors, wanted to hear about it. bre advised that ISR recognized all of the expenses for the clearing of the land since they paid all of the money and received the reimbursement from the EDA. ried to recognize the revenue as well buf und fs ‘old by coat WVETCE already recognized the revenue. Peas not tand how Mollohan-875,ar) e e 58C-WF-233698-302 Contain of FD-302.0f __| +0n.04/10/2007 _, Page WVHTCF could recognize the zevenue but none of the expenses. recalled having to eliminate the revenue in their accounting system per i she had already accounted for ite Ly tamediately told about this situation and told about it last year. 1 ght that[ 1 overheard| talking about it. lid not know if| was aware of the inner financial dealings. According to of WVHTCF in late 2001. explained that was the only individual who signed off on the money going in and out of the escrow if $50,000 or under. Anything over $50,000 required tw. signatures. Included in the packet of information provided to were memos from to requesting that VRC release the funds from the escrow to WVHTCF. Also included were some copies of cashier's checks in large amounts. advised that REP. MOLLOHAN had input in every part of thé construction of the ISR building to include a weekly slideshow that was sent to him from ISR. REP. MOLLOHAN directed and approved everything on the building. stated her contact at EDA was waS HSE contact at HUD. After the escrow was gone, ISR began directly paying the vendor for the construction of the ISR building, MASSARO CONSTRUCTION. stated that was a VRC consultant who was hired through VRC to handle the interior design of the ISR building in early 2001. ISR paid_a retainer of $66,000 to VRC for Services via check. []signed the check and gave it fo without a second signature as required by ISR rules. continued that was replaced by[[_] who was a full time employee of VRC. After a a icant amount of time, — status with VRC changed to a contract employee and was paid a lower rate by VRC. The Financial Analyst for TSR; [oe ]realized this and felt that ISR was being over billed. b6 Bre b6 bic b6 Bre bé bic Mollohan-876,D302 (Rev. 10.695) S8C-WF~233698-302 Conimuaion ot FD-3020f __| ,0n.04/10/2007 _, Page From 2005 to 2006, ISR paid VRC y advances a because VRC was having cash flow issues. om ot) cian bre submit invoices to ISR for the actual amoum wentually stopped submitting i e issue was raised to the new administration since| had left ISR. stated the retainer was never returned and wondered if this was HUD money that was lost. jadvised that she and determined that ISR was over billed by $40,000 which did not include the retainer. The main dispute was whether was considered an emp. or not and what tl ct specifically said about it. felt that she and lost the dispute to l be [-_—___] General Counsel ror vac. [ oid [___] that agreed to an audit of their billings, but it never happene tad stated that! handled all VRC invoices and now worked at MYLAN PHARMACEUTICALS in Morgantown, W eae) could be reached on her cellular telephone In February 2006, after the decision on the dispute was made, ——]went directly + ‘Accounts Payable Accountant who reported to and asked him to create a check to VRC without a purchase order. immediately went to ho created a purchase order for the check. who approved the purchase orders from VRC, refused to Sign the purchase order. bs be advised that the merger of ISR and WVHTCF was announced on October 14, 2005 at a Board of Directors meeting. felt the only reason for the merger was that REP. MOLLOHAN wanted to get rid of nad a plan to make ISR self-sustainable and REP. MOLLORAN would lose control. REP. MOLLOHAN did not like or want to lose control of ISR. The official reason provided was that each entity was in financial hardship. continued that she did not want to work for WVHTCF and now all of the ISR employees were officially WVHTCF employees. b6 [ ed that [ Jwas the| ay at the time of the EDA and HUD grants. Had to be aware of the revenue recognition by WWHTCF WITHOUE Fecognizing any expenses since that happened while she Mollohan-877soap 68 e 58C-WE-233698-302 CContimation of FD-302 of On 04/10/2007 _, Page was still at WVHTCF. is also the individual who provided the $80,000 Invoice fo ISR for prior expenses. According to took over for continued that From WVHTCF would also be aware of the revenue FeCOgnitTon- heard at one point that one of the VANDALIA HERITAGE FOUNDATION/VRC accountants discovered that as "skimming" money from VHF/VRC. The accountant was then fired by a staffer for REP. MOLLOHAN. ntinued that while at ISR, she worked with who was current] for_a long time. nada drug problem. wondered if REP. MOLLOHAN was giving money because could not see how] could afford to own property. [advised that lwas great at keeping notes on everything did. [7 __Jnever heard of any reimbur: REP. MOLLOHAN'S campaign but believed that donated the full amount to REP. MOLLOHAN. ment for donations to recalled a time when| tried to donate money to REP, MOLLOHAN's campaign and REP. MOLLOHAN returned the check to him. was not aware of any specific ties that either CENTRAL or THRASHER ENGINEERING, a contractor on the construction of the ISR building, had to ISR or REP. MOLLOHAN. wondered why ISR paid who had a company called the ROBISON was a@ Tobbyist and ISR paid him $5,000 per month. could not understand why ISR needed a lobbyist. recalled that during the creation of the high tech Bank, said, "It feels wrong taking money from nonprofits. According to there was a lawsuit between MASSARO CONSTRUCTION and ISR. MASSARO won $2,800,000 and ISR paid them b6 b7c bs BIC be b7c b6 7c Mollohan-878roan 699 e e 58C-WF-233698-302 Continuation of FD-302 of +0n04/10/2007 __, Page via loan, The lawyer fees that ISR incurred during the lawsuit exceeded $1,000,000 and were paid using HUD grant money. ‘ted the former Human Resources employee at ISR, was now an employee at the same company wherel——] worked. bé bic Mollohan-879#02 (Rey. 1046.95) of birth FEDERAL BUREAU OF INVESTIGATION socifa security number Dae of trnseripon 04/24/2007 date Wasi (cexviewed at her nome residenc Fairmont, West Virgynia 4, cellular eélepnoner information: ‘After being adviged of the i agents and the nature of tl following interview, the Gaeervtoning rovided the bé Ic Jackson for breakfast and offer her a position with VHF. eventually accepted a position at flexibility she would be provided elly. In early 2005, Prior to joining VANDALIA HERITAGE FOUNDATION (VHF), handled some legal work for VHF while she called explained that she started in Was more as es of a and wag given the responsibility of [J Dut no authority, which was a common managerial Erait of Hventually, the title was taken away From insulate From employee issues. continued that her said that[——]was not happy an architect at var. T ]felt there struggle between anything she_did not agree with, which made difficult. was out of the office the majority © while did_not purpose was to with was a power want to hear Worked at VHF. job more thought VHF should have a true independent oversight Board of Directors hut did not receive support for the idea. recalled that three to four days per month and did some work from home. were upset when the time bé bic becaie ia sasascmmcememea| [ Jadvised that worked in the office about Investigation on 04/11/2007 Fle# S8C-WE-233698-302 ~$X by “The document conaine nether recommendations nor conclusions ofthe FEL Is the propa ofthe FB and i loaned to your agency, a Fairmont, West Virginia Date dictated 04/23/2007 SA It and is contanis ate not to be etbuted outside your “TT 341.30 b6 bic Mollohan-880,FDA02a Rev. 10-695) 58C-WF-233698-302 Coniuation of FD-302 of 10» 04/11/2007 _,Pase _2 supervise reported to and handled the accounting and financial work. Ti As was accountable for how the finances wi xe done but had no control over the process. did not give the authority to control the process. jas not aw improprieties in re: that the financial cI jare of any inappropriate conduct or financial gards to the finances of VHF. [_____]said Yecords at VHF were very disorganized. said she believes in the mission of VHF but not in how it Is being managed. apartment &x paid in rent. aid through a grant CE Sitoved into would charge the VHF owned house said that for a long time Jrented the om REP. MOLLOHAN but was not sure how much believed that salary was it as she was a consultant for a time. a percentage of the lodging costs and provide: he garage apartment/carriage house after very detailed receipts. heard that now lived in at 709 Benoni Avenue, Fairmont, wv. lexplained that she had fallen out of grace with by mid-September 2005 or after about six months. advised that fell from grace with SCIENTIFIC RESEARCH while he was working on the construction of the INSTITUTE FOR, (ISR) building. was and eventual. ty Jwanted toGet Fid of was returned out of According desperation by| to she did not feel comfortable going into detail regarding the over-billing dispute between ISR and VANDALIA REDEVELOPMENT CORPORATION (VRC) . said the reason for her trepidation was she considered it attorney-client privilege. continued that the conflict could have been avoided if not For between VRC and ISR say the contract wa: of VRC at the begin a consultant to VRC. services. during some of the General Counsel, for the sloppy invoicing by VRC, The contract was not clear and felt a judge would s ambiguous. Basically, was an employee ning of the contract but at some point he became VRC continued to bill the same rate for continued that VRC was_underpaid contract. worked with ISR, because she felt he would be more objective than an ISR employee. was very b6 prc bé pyc bé b7c Mollohan-861“wp s0ne or 10-695) 58C-WF-233698-302 Continuation of FD-302 of On 04/11/2007 __,Pase 3 close with and "had an axe to grind" with for her treatment oF said that she was not involved in the South Fairmont project because did not want her in the planning meetings. reiterated that did not want to hear about any potential problems or issues. understanding was that VRC exercised the option on the land for the South Fairmont project until all approvals were received from federal agencies to allow VHF to use grant mone: be a turn about one y to buy the land from VRC. Originally this was going to around of 30 to 45 days but VRC held onto the land for year. VHF did eventually purchase the land from VRC. een ee did not hi i judgement . be a consu too mich £ West Virgil Bn example was_the amount they paid to tant for VHF. [-__lfelt that var paid at least 10% ‘or his services. used to work for former nia Governor BOB WISE. grants. According —Srrr—“‘i‘#i:C*CszC*ésCrsC*C*ON of felt that L VEF fsmlovess both had a very good understanding of the use of grants. hought that would willingly "walk close to the Tine® but not knowingly misuse government funds. explained that worked for MCCABE and VRC. described HENLEY (M-H) and brokered almost all the deals for VHF VHF paid M-H who would in turn pay as arrogant, volatile, and demanding. recalled the bidding on the Morgantown Industrial Park which was being sold by a group led by who was acting as broker for VHF, was competing representii against a fellow M-H broker, who was. ng another client. had heard in the past that sometimes was paid real estat! ‘Or broker services even though he did not work on the € deal. An example of this could be when VHF bought the lawsuit Ace Exterm: 's building on Ogden. This deal was currently in a Tegan pansto sp ‘Best work. actually di on the few deals that joxked on with him but Jdid not think it was the be bre b6 Ic b6 Ic 6 bre Mollohan-882* mp.a0da Gow 10-695) 58C-WF-233698-302 Continstion of FD-302 of +0» 04/11/2007 __, Page According to self-sustainable. said that] was a talked abut WE beroning part of that conversation. explained that| had direct contact with REP. MOLLOHAN'S staff regarding grants and other issues. ae said that developed a personal relationship With REP. MOLLOHAN’ When ead about REP. MOLLOHAN and owning property togeyhax Gn Bald Head Island, ‘she thought it was stupid". did ask if she stay at her property in Bald Head Island off season. never went to Bald Head Island. While at VER, heard that had owned the Palace Building and was Surprised that VEF had purchased the building a recalled that the employees of VHF “were not crazy’ about the Palace Building. advised that she hi s with was on a lease to own schedule fora loft owned by 6 WEF? assisted with the renewal of the leases of VHF bre property by MOUNTAINNADE . heard of discussions of a uilding a pottery studio im Ehé Basement of the Buckston Building. was not involved in the planning meetings. recalled seein: had with ISR during the construct: agreement was done prior to her j g the escrow agreement that VRC ion of the ISR building. The oining VHF. Mollohan-883FD.302 (Rev. 1046.95) FEDERAL BUREAU OF INVESTIGATION Date of transition _04/25/2007 Jwas interviewed at the law offices of bE Stember Feinstein, Allegheny Building, 429 Forbes Avenue, pIC Pittsburgh, Pennsylvania 15219. Also present during the interview were and of Healey & Hornack, P.c. Strict of Columbia Assistant United States Attorney participated via telephone. After being advised of the Idéntities of the interviewing agents and the nature of the interview, provided the following information: ve bre br Investigation on 08/10/2006 # Pittsburgh, Pennsylvania ree S8G=WR=233608-202 “E> owe sestes 9/28/2006 3A bs SA bie Tide tte ae tbe ated cance Your Mollohan-884 ‘Tis cocuet contains nether secormendstns rer conc 1 the propery of the FI ant feared o you agency [ prsersese e FEDERAL BUREAU OF INVESTIGATION Date of transcription _0.4/26/2007 and attorni lof Stember Felnstein, contacted SA via telephone and provided the following information: —— = bre (Cd 6 bre Imvettoaton on 08/11/2006 _# Pittsburgh, Pennsylvania (telephonically) Fes S8C-WF-233698-302 OX bute dewtes 09/29/2006 by SA bs SH {S$ bic Tis document consis nether recommendations ror conssons ofthe FAL I the popety ofthe FI and Is kana to your agency; Ion cots seo bead oe Fur Mollohan-891 fer 1G 2S5eQFD.302 (Rev. 10.695) le FEDERAL BUREAU OF INVESTIGATION Date of transcription _04/26/2007 A telephonic interview of was bs fi bre ID provided the following information: v6 bre ID Invetiosten on 10/12/2006 _# Falls Church, Virginia (telephonically) Fie# S8C-WE-233698-302 o FS oat aested 10/19/2006 sal bs SSH + bre ‘The seeuent conan ner aeormnsotons nor concn ofthe FL the pepery tthe Fane ane to your soe Band scones are not be ditt ousie you agen) Lb? N71. 365 Mollohan-892FEDERAL BUREAU OF INVESTIGATION Date of transcription _04/27/2007 A telephonic interview of was bs conducted. Also present for the intervii a as pe Jprovided the following Information: b6 bre ID tovetioatn on 10/13/2006 _# Falls Church, Virginia (telephonically) Fle# S8C-WE-233698-302 ~%bo ue acstea 10/19/2006 bs wy SA be “Tis cocrant conan ner reconmndaons ner cnc of the FBI the pope the FB sd and to your age, Mant cones sera fo be ert ste Your any [pr 282.20 Mollohan-895rosa e849 e ® FEDERAL BUREAU OF INVESTIGATION Date of transcription _06/06/2007 » epartment_of Housing bre zi 2 as, ymterviewéd at his offiog, which _is_located_at_asl 7th Street 3M, Room 7146, Washington, /0.G—Also present during the interview was HUD-Offree~ofTnspectsr General (OIG), Special Agent After being advised Jf the identity of the interviewing agent, and the nature of the jAtervien, provided the following information. ae ES b6 bIc The last grant issued to ISR was in 2005. has never had any interaction with Congressman Alan Mollohan, or any ISR or West Virginia High Tech Consortium Foundation (WVHTCF) employee in relation to grant number B-OONI-WV-IS-001. Due to the large volume of grants issued from the Congressional Grants ; and since the grant money had been earmarked by Congress, Pet stias mot surprised to learn that ISR had also received a bs Separate $2 million grant from the U.S. Department of Commerce, bre which was also to be use +e preparation of the land acquired by ISR from the WVHTCF. provided a printout of the payment history ber B-OONI-WV-IS-001. According to these records, (retired) and were the only HUD employees who approved a draw on the grant money for ISR. Investgaton on 06/05/2007 _st_Washington, D.C. Fie# 58C-WE-233698 SUB 302 -S7 Date detsted 06/06/2007 by SA bé 2) bIc ‘This document contains neler recommendations nar conclusions of tho FB. ite the property of the FSI and is loaned to your agency: Tang its cantons ar nol to bo ectbuod outside your ag hn 1511, 302 Mollohan-897. os ® e FEDERAL BUREAU OF INVESTIGATION te of transcription _06/15/2007 date“of_bixth,. telephone number, wae” interviewed at his residence, which Ts 1 Kensington, Maryland, 20895-~ Also present during the interview/was Housing and Urban Development ‘ice of Inspector Geney41 (OIG) Special Agent After being advised of the identities of th Interviewing agents, and the nature of the interview, bs provided the following information. bre retired as | in January 200) I ‘SOB-WaS-EO-EHSUES Chat all -HUD Congressional appropriation grants were issued in a timely fashion to each grantee. Once the list of grants were received from Congress by[ oe] office, grant applications were sent out to the grantees for completion. The typical grantees were eithe: t organizations or state or Tocal government agencies. oes had the impression that z Congressmen BYRD and MOLLOHANHad a great scheme to bring high 67 L technology jobs to the young people of West Virginia. In-order to refresh memory, SA showed lated September 21, 2000, addressed to From Institute for Software Research (ISR), In the mid 1990's, Congress began earmarking funds for programs falling under a small division of HUD entitled the Neighborhood Initiative Program. Grant number B-OONI-WV-IS-001 was issued to the Institute for Software Research (ISR) through this Neighborhood Initiative Program. Over the course of this grant, primarily corresponded with This contact was usually done by phone; bs however, on one occasion prior to the issuance of the grant, bre eee] is in person with a representative of ISR in 1999 or This person showed plans for a building to be built on the land, which was to be purchased with the grant money from HUD. [Thad to approve any draw down of the money issued from the gr . In September 2000, $2.9 million was approved by for ISR to draw money from the grant in order for the purchase, settlement, and clearing of a 13 acre parcel of levestgaton on 06/15/2007 _a Kensington, Maryland Fie # 58C-WE-233698-302 —G& Date dictated 06/15/2007 by SA bé bic “Tis document conains nether recommendations or conclusions of the FBI. Mis the property ofthe FBI and ie loaned to your agenoy I end ls contents a not fo be cistrbuted ouside your ager Mollohar-898 WLG6/.302em rosea. 10685 e e CContinvation of FD-302 of, +0n 06/15/2007 Page 2 BS 58C-WF-233698-302 bIc land. did not consider it suspicious for ISR to place the money into an escrow account because HUD did not want grant recipients to commingle grant money with a company's operating capital or any other grant money. In addition, every grantee was required to place all received grant money in an account where it could be safeguarded and easily traced. ISR was considered by ta he one of the more sophisticated non-profits with whom nad worked. This particular grant proceeded on ISR's time table, and received minimal monitoring from HUD because it was originally a congressional earmark handled out of the District of Columbia (D.C.). ISR was require emi-annual reports that were reviewed by personnel in office. These reports were used to ensure that ISR was spending the grant money in accordance bs with the language of the grant project. ae did not believe he —4) to Congressman ALAN B. MOLLOHAN about this grant, but did probably speak to someone in MOLLOHAN's office at some point about various grants earmarked by MOLLOHAN. Communications from Congress were typically routed through _the HUD Congressional Affairs Office; although, from time to time, did personally receive phone calls from various congressmen about different grants. Mollohan-899FEDERAL BUREAU OF INVESTIGATION Date of tanseription _07/18/2007 Clarksburg Resid so conducting the interview was SA was advised of the identiti of the interviewing Agents and the nature of the interview. provided the following information: was interviewed at the Pittsburgh Division, a a According to PROLOGIC named the commercial product either LIDAR DME or LIDAR FCE. It can be used environmentally and militarily. The government can use LIDAR for planning and digital terrain mapping. The military can use LIDAR to locate tanks under trees and locate the disbursement of biological agents. LP360, located in Colorado, is the main competitor to PROLOGIC regarding the commercial sale of LIDAR. jidentitied [ Jas an employee who left PROLOGIC on bad terms. does not know anything regarding the topics previously discussed. fontinued that both worked_on the LIDAR project but Teither were bothered that a commercial product was being created. stated that keported to Was feEechnical assistant but was now performing the same Tasks as advised that time sheets were falsified on almost every project. Specifically, the XMDF Project with the Army Corps of Engineers in late summer, early fall of 2005. The project lasted a couple of months. billed hundreds of hours on the project but_did not work on it other than attending one 30 minute meeting. did not bill to the real project he was working on and never billed to two separate projects simultaneously. Imvestoton on 06/26/2007 __# Clarksburg, West Virginia b6 bIc b6 prc bé prc 6 bic ret 58C-WE-233698-302 ~ IO ate deaes 07/03/2007 by SA ‘This document consis saer commendations nor concusons ef the FEL I isthe property ofthe FSI snd is losned to your agen ‘and is contr ae net © be citbuted outside your agen b6 bic 724. Bea Mollohan-901¥ “ FD.302a (Rev. 10-695) ‘Continustion of FD-302 of S8C-WF-233698-302 ee »0n.06/26/2007 _,Page__2 According to the falsifying of time sheets was openly talked about in the office. Paper time sheets were originally submi: ow time sheets are completed electronical] ti e submitted to his ee hen to supervisor, oo boss then to in accounting. often told to change his time sheets in order to charge more time to @ certain project. PROLOGIC employees would work on commercial products and Services but bill their hours on government grants. said that PROLOGIC hired a company called CTC to assist in completing some projects. did not understand why PROLOGIC hired Crc. ated that the | was selling bs PROLOGIC. goal was to make money then se eee. bre If PROLOGIC receives a sizeable earmark or contract, would be in a much better position to sell PROLOGIC. advised that [ Jnad a good relationship with a of SAIC which resulted in a large earmark received from UNITED STATES REPRESENTATIVE ALAN B. MOLLOHAN. Mollohan-902F202 (Rev, 10-695) FEDERAL BUREAU OF INVESTIGATION Dace of transcription _08/09/2007 & August 8, 2007, Special Agent pe bic contacted number, in reference to telephone [see attached]. bic L ‘nvestgaton on 08/09/2007 _st Falls Church, Virginia (telephonically) Fes 58C-WE-233698 suB 302-41 bate dette’ 08/09/2007 by SA bs bre ‘hls document consis neitier recommendations nor conclusions of the FB Ite te property of the FBI and Is losned to your agency, Wand its cantons are et o be dstibuted outside your agen Mol OT A21), 302“ D302 (Rev, 1046.95) FEDERAL BUREAU OF INVESTIGATION Date of transcription _O5, cellular telephone was interviewed via telephone and provided the following information: kdvised that his company and utilized the same computer services company, GLOBAL SCIEN 0: TECHNOLOGY (GST), andthe same computer technician, [ Jwas told by that sometime after the investigation Into UNITED STATES REPRESENTATIVE (REP.) ALAN MOLLOHAN became public knowledge by the New York Times, reformatted [ computers. said that the reformatting essentially erased everything off of laptop and desktop computers. Jwestigation on 04/26/2007 a Falls Church, Virginia (telephonically) Fos S8C-WE-233698-302 —Tr ste dettes bees ‘his dosumert conta nt ecommencstans nor concn of the FEL Re the pros ofthe I and a ane o your agen, Wand cere set fb Stes te Your 9 BB STI, BOR bé bic bé bic bé b7c Mol}FD.302 (Rev. 10-6-95) FEDERAL BUREAU OF INVESTIGATION Date of transcription _05/17/2007 Fairmont, West Virginia 6554. home be}ephone numbe: cellular telephone date of bifth Social security number [was intervjéwed at the FBI CJIS satellite office in the Middletown Mall, Fzirmont, WV. Also conducting the interview was SA\ After being advised of the identity oiamee eine agents and the nature of the interview, provided the following information: advised he joined PROLOGIC asa PR( as already a public company when was hired. said PROLOGIC is an 8A company, which is a disadvantaged business. PROLOGIC is considered an’ 8A company because the is of be bic descent. An 8A designation lasts for a maximum of eight years and PROLOGIC is the largest non-tribal 8A company in the United States. PROLOGIC has approximately 250 employees and has received grants from the federal government to include the Department of Defense (DOD), Department of Energy (DOE), and National Security Administration (NSA). stated the first project he worked on at PROLOGIC was called Service Oriented Visualization Framework (SOVE). It was an earmark sent through the Air Force totaling approximately $4,000,000. ‘The purpose of the project was for Research and Development (R&D) but approximately one half of the earmarked money was spent on creating a product to be sold commercially by PROLOGIC. The product used Lidar Data, which is similar to Radar, the difference being that Lidar used light The product would be used by airplanes. advised that the Air Force contact person, was not aware that PROLOGIC was making a commercia product with Air Force funds. [is an Air Force civilian employee, a GS-15, and worked at the Electronic systems Command in Boston, Massachusetts. thought the earmark originated from the office of UNITED STATES SENATOR (SEN.) JAY ROCKEFELLER. b6 Ic Imostyaton on 05/03/2007 _ at Fairmont, West Virginia res 58C-WF-233698-302 ~43 awe deites 5/14/2007 by SA b6 ‘The document contain rather rsemmmencatons nar conduslon ofthe FBL 1 the sropery ofthe FBI and Is losnad to you agony, Wand is content ae not fo be datbules outie your “Tprsss'. Boa Moll | | IC(a @ FD 3024 Rev, 10-695) S8C-WF-233698-302 Continuation of FD-302 of .0n 05/03/2007 Page __2 said that PROLOGIC had not earned any profit on the Lidar project commercially since they had not yet completed ———— $e —": os with the idea to use the Rep undp to create the Lidar product re and sell it commercially. continued that were all aware Of using R&D funds in this recalled telling that was incompetent as 4 Program Manager at PROLOGIC (REP.) ALAN MOLLOHAN from the advised that the company received an email that was going to testify in the grand jury regarding the Thvestigation on UNITED STATES REPRESENTATIVE owned by b3 b6 BIC stated the buildings that PROLOGIC rents are continued that owned one of the other buildings. jowned two of the buildings and b6 Ic said that Jcould confirm thé Information provided on the Lidar project. oversaw the Lidar project. advised that PROLOGIC committed billing fraud on numerous projects being funded by government grants or earmarks. said that PROLOGIC utilized a Chief Scientist or a Program Manager who were contractors to PROLOGIC and not employees. PROLOGIC did not get the appropriate approvals to utilize the contractors so they had PROLOGIC employees take ee credit for the time the contractors spent on a project. bre jadvised he has never made any contributions to the PROLOGIC PAC and had never heard of anyone being reimbursed for their donations. Mollohan-911'RD-302 ev. 106.95) FEDERAL BUREAU OF INVESTIGATION Date of transcription _09/13/2007 Morgantown, bs pre West Virginia 26501, cellujér telephone number was interviewed at the terfront Place Hotel, Morgantown, West Virginia, Also condug¥ing the interview was SR Deed After being advised the ident sty of the interviewing agents and the nature of the interview, provided the following information: BIC said that Project Managers at PROLOGIC managed several projects and their main responsibilities were to liaison, review and approve timesheets, and the general overview of the projects. The Technical Lead's responsibilities included the day to day technical decisions and they worked only one project at a time. The Senior Developers had on average 10 years of experience. According to was the r— on the LIDAR project. The on Phase I of the LIDAR project was Handled the proposal and proof of concept. When PROLOGIC was awarded a project, The for Phase II was was, frechnical Lead. In the summer of 2006, = the 6 for LIDAR and for three months worked the LIDAR bie project on his own. advised that the LIDAR project was a SMALL BUSINESS INNOVATION AND RESEARCH (SBIR) project which meant that Imestaaten on _ 08/23/2007 __# Morgantown, West Virginia Fie# 58C-WE-233698-302 ~ 14 bate dees 08/30/2007 je SP lace] b6 bIc “ois eacument contin nar ecommandatons nor conuson ofthe FB, Mls te property of to FB and fe leaned fo your agency: and te contri ao net te be buted cusde your epeey [_} JOSL2. 36>. MollofPom 09 e e 58C-WF-233698 CContinstion of FD-302 of On 08/23/2007 __, Page PROLOGIC was to use the government funds to create a commercial product. The product created by PROLOGIC, LIDAR EXPLORER, was now being sold commercially. said that the NATIONAL AERONAUTICS AND SPACE ADMINISTRATION (NASA) paid PROLOGIC for the commercialization of the LIDAR product. NASA requested updates on the commercialization of the LIDAR product recalled that initially paper timesheets were submitted but PROLOGIC changed to an electronic system for timesheets. The paper timesheets were submitted on a weekly basis and the electronic timesheets were submitted every two weeks. Timesheets were approved by the Project Manager said that normally employees worked 60 to 65 hours per week but only claimed 40 hours. Overtime was not billed [——aavised that each employee needed authorization to charge time to a certain project. Each project had a separate charge code. @id not think that Project Managers billed for their time said that positions at PROLOGIC were not 9 to 5 jobs and gave the following example of a typical timesheet Monday Tuesday Wednesday Thursday Frida’ Actual 15 hrs 5 hrs 8 hrs 10 hrs 8 hrs Submitted 8 hrs 8 hrs 8 hrs 8 hrs 8 hrs According to a few employees did not work enough hours but billed 0 -hours. said they were lazy and lied on thet tineshests, Tyo auplovess who Ligd on their timesheets wer moved out of state to work eee and just_resigned and left on bad terms. can be reached at stated that all PROLOGIC employees received a letter from executive management encouraging them to donate to the PROLOGIC Political actio: ittee (PAC). There was no mention of reimbursement but got the feeling that not donating would affect raises and bonuses. donated $10.00 per check to the PROLOGIC PAC indicated that PROLOGIC billed the government on an hourly basis but he was not sure if they billed different rates for their own employees compared to subcontractors they hired. [7___]recalled working a co-contract with SAIC and b6 bic b6 bic 6 bre Mollohan-913‘ose. 0635 e e 58C-WF-233698 Continuation of FD-302 of ,0n.08/23/2007 __, Page also with Northrop. PROLOGIC hired CTC as a subcontractor. cTC either stood for COMPUTER TECHNOLOGY CORPORATION or CONCURRENT TECHNOLOGY CORPORATION. [[____]did not understand why PROLOGIC hired CTC since PROLOGIC could have handled the work internally. Bé said that the INSTITUTE FOR SCIENTIFIC RESEARCH auld (ISR) worked on the LIDAR project. ISR was tasked with research but they delivered unusable codes. ISR created Y papers which provided information at the eni eI. The information was of no help to the Developers. felt the purpose of ISR was to show that two small companies can work together. Basically, it was a public relations move to win Phase II. According to PROLOGIC had employees start work v6 while they were obtaining their security clearance but would get bre the clearance before it was needed. Mollohan-914FD.302 (Rev. 10-6-95) ele FEDERAL BUREAU OF INVESTIGATION Date of transcription telephoned the interviewing agent and provided the following Information: or advised that the VANDALIA HERITAGE FOUNDATION (VHF), honest and might have valuable information. and believed that VHF was paranoid _in aepere finances and the investigation. & JOHNSON. was very was told regarding their went to work at STEPTOE said that ]sold his Chevrolet Dealership toT Jand he might have also sold his building. L___Tbelieved that protect himself from the investigation is preparing to stated that[ ] owns SHUCK STEEL and donated $1,500 to UNITED STATES REPRESENTATIVE (REP.) ALAN MOLLOHAN's campaign. Fairmont received a grant from the Department of Interior to only be fi i leased by Attorney 1 was FTght. REDEVELOPMENT CORPORATION with the MARION COUNTY urchase some land which could believed the land was being Old by the Fairmont City 02/11/2008 bs b7c Imestpaton on 02/08/2007__t Fairmont, West Virginia (telephonically) ret 58C-WE-233698-302 ~ 75 by SA ‘Tie document conte rather recommendations nar concsone of tha FL. 11 the property of the FI and if loaned to your agency ond is contr are no 6 be datnsed custo you agony. [ps D1.30Q Date dates 01/31/08 Molla 6 bic bé bicFD.302 (Rev. 10-6-95) io FEDERAL BUREAU OF INVESTIGATION Date of tanseripon _02/19/2008 West Virginia home telephone number lular telephone number social security number date of izth, was interviewed at her place of employment, Jonathan B, Robeson Law Firm, Oakland, Maryland. Also participating in the interview was Small Business Administration (SBA) Office of Inspector General (1G) sA[——] After being provided the identity of the interviewing agents, provided the following information: 6 bic [ Jadvised that was _now working at THE CLAY Th Charleston, West Virginia. was not positive of current address. recalled taking a trip to Maine paid by MOUNTAINMADE that cost approxima 8,000. The trip was bs supposedly £ uurposes but wondered if it was really bre a vacation. also had numerous charges to her MOUNTAINMADE debit card from restaurants in Carlysle, Pennsylvania, which is where her daughter lives. took a trip to New York and used her MOUNTAINMADE card to charge items bots and Eileen Fisher, both clothing stores. In tgtal, found approximately $12,000 in charges where. did’ Hot provide a receipt and needed explanation. created a spreadsheet listing the purchases that were in question. It was common knowledge that did not favor using SHIELDS as the outside, end ofthe year audit firm felt they were too thorough. recalled that was the firm that MOUNTAINMADE utilized for two Teas. ve When first detected the charges, she talked to bic jof TOOTHMAN RICE. TOOTHMAN RICE was the outside accounting firm that with month end reconciliation. [--]told then chat Df youd net. provide receipts and that she did not think the irchases were legitimate_work related items. said "I_know this goes on” nd that “| had the same issue.” advised to go to the Board of Directors with the information but that they had no obligation to inform the SBA. Imvestgaton en 11/08/2007 __# Oakland, Maryland fas S8C-WE-233698-302-U ae ates by SA b6 bic ‘This doeuran contin nother recommendations ner concur Ite Be property f tho FBI and fz loaned to your axon, Wand is contents ae not fo be asics cusise Your 700) 8509_30> MollohéContinestion of FD.302 of D.302 (Rev. 10-6-95) e 58C-WF-233698-302 On 11/08/2007 __, Page called who was on the Board of Directors, first then met with © later on. Between the time she Re entire Board of Directors first talked to and the Board of Directors' meeting, REPRESENTATIVE (REP.) ALAN B. MO) saw UNITED STATES LLORAN meeting with assumed it was because was interviewed by @ reporter regarding MOUNTAINMADE receiving earmarks. After speaking with sent a copy of the "In Question Spreadsheet" and th overn: @ bank card statements to ight via U.S. Mail. ecollection was that the following attended the Board meeting: employees of MOUNTAINMADE. the debit card issue by question: said she used the debit awhile. also said she t the use of the vehicle but she n discussion lasted about 30 minut: approximately 60 minutes. Board meeting. After the Board meetin who told her to meet w: outstanding debit card charges expenses were truly personal and charges. Also, whatever charges should be placed into the genera! Travel Expenses. wrote xeimburse MOUNTAINMADE, the last $2,592.00. When attempting to sec COUNTY BANK for MOUNTAINMADE, either The let! Daring the Board meeting, one topic of discussion was the reporter who was interviewing lead_the discussion into ing both card for personal use once in ook the MOUNTAINMADE vehicle to visit her daughter and that she would reimburse MOUNTAINMADE for ever did. The debit card es of the meeting that lasted was never invited back to a ived a call from regarding the would mark down which urse MOUNTAINMADE for the could not explain TSager account titled three separate checks to check was in the amount of S, ith ren ure a line of credit at GRANT handed a letter to tex needed signature from the SBA in order to secure the loan. TOIT LL] Ehat HOUNTAINMADE was money a8 collateral for a bank li COUNTY BANK had already agreed t mailed the letter to Grants Management Specialist, SBA. not allowed to use SBA oan or line of credit. © open the line of credit-prior rant, be bic bé bre bs bre Mollohan-917FD-3028 (Rev. 10-695) 58C-WE-233698-302 Continuation of FD-302 of ,On.11/08/2007 _, Page __3 to receiving the signed letter from the SBA. old [ that they just would not respond to the bank's request for the letter. MOUNTAINMADE used the line of credit for approximately six months. that MOUNTAINHADE couli could not use SBA grant money as collateral. a MOUNTAINMADE employ: advised that used to go to did not recall| apartment and find items that assisted her in reconciling MOUNTAINMADE's inventory. ever asking her if any told when they closed the line of credit ot use the line of credit because they fraud occurred at MOUNTAINMADS while he was conducting the year end audit. also did not recall s: she was and confi wi issues. said that balance. as ny ma ying any paper stating aware of any fraud the accounting books information? was recently wie below is her updated contact work telephone number ~ 6 bic ee, b6 BIC Mollohan-918D-1023 (Rev. 622-2007) FEDERAL BUREAU OF INVESTIGATION Confidential Human Source (CHS) Reporting Document Reporting Date: 02/04/2008 Case 1D: 58C-WF-233698-302 (Pending) AF (Pending) ID Contact Date: 05/30/2007 Type of Contact: In person Location: Written by: SA re Other(s) Present: SAl Source Reporting: bé Ic »7D eS SCI. upd be bicFD-1023 (Rev. 622-2007) FEDERAL BUREAU OF INVESTIGATION Confidential Human Source (CHS) Reporting Document 02/07/2008 Case ID: 58C-wF. 02 (Pending) JS (Pending) Contact Date: 06/05/2007 6 Type of Contact: —Telephonic bre BID Location: Weitten by: SA Other(s) Present: Source Reporting: bs bre pT ” 34. wed nS ae Moll bre‘ FD-1023 Rev. 6-22-2007) FEDERAL BUREAU OF INVESTIGATION Confidential Human Source (CHS) Reporting Document Reporting Date: 02/07/2008 Case ID: 58C-WF-233698-302 (Pending) —QQ [— —____ } Pending) Contact Date: 07/16/2007 Type of Contact: Telephonic Location: Written by: SA Other(s) Present} Source Reporting: ” [_peste-vet bé b7c 7D b6 Ic fey” b6 BICFD-1023 Rev. 622-2007) FEDERAL BUREAU OF INVESTIGATION Confidential Human Source (CHS) Reporting Document Reporting Date: 02/07/2008 Case ID: S8C-WF-233698-302 (Pending)“|OO | (Pending) bs bre Contact Date: 08/02/2007 a Type of Contact: — Telephonic | Location: Written by: SA Other(s) Present? Source Reporting: b6 b7c 7D 3344.wed bs MoFEDERAL BUREAU OF INVESTIGATION | pbana ee 632.200 Confidential Human Source (CHS) Reporting Document Reporting Date: 02/07/2008 Case 1D: S8C-WF- =302 (Pending) ~IOl (Pending) bs bre Contact Date: 10/26/2007 a) Type of Contact: Telephonic Location: Written by: SA Other(s) Present? Source Reporting: bé bre Gam + bé 0 8398 pd BreFD+1023 (Rev. 622-2007) FEDERAL BUREAU OF INVESTIGATION Confidential Human Source (CHS) Reporting Document Reporting Date: 02/07/2008 Case ID: 02 (Pending) ~“|OR (Pending) bs 76 Contact Date: 12/14/2007 ia Type of Contact: Telephonic Location: Written by: SA Other(s) Present: Source Reporting: bs b7c 7D bs O8Y0!. wed pre~ e e FD-1023 (Rev. 622-2007) FEDERAL BUREAU OF INVESTIGATION Confidential Human Source (CHS) Reporting Document Reporting Date: 02/08/2008 Case ID: WE: =302 (Pendingy-l03 Pending) bs bic Contact Date: 01/22/2008 BID Type of Contact: — Telephonic Location: Written by: —sa[—————— Other(s) Present: Source Reporting: be bre BI ++ 02 wed ve los 7 Bre Molles ves e ‘FD-1023 (Rev. 6-22-2007) : e FEDERAL BUREAU OF INVESTIGATION Confidential Human Source (CHS) Reporting Document Reporting Date: 02/15/2008 Case ID: 58C-WF-233698-302 (Pending) IO (Pending) Contact Date: 02/12/2008 Type of Contac! Telephonic Location: Written by: sal Other(s) Present? Source Reporting: - mee Moll bé bIc 7D bé bic 7D b6 7c. e ° D302 (Rev. 1046.95) ae FEDERAL BUREAU OF INVESTIGATION Date of transcription 02/27/2008 | Gate of birt home address: Grafton, West Virginia, 7 was interviewed at the District of Columbia, United States Attorneys Office, which is located at 555 4th Street NW, Washington, D.C. fue proses vata tha “ates were asclatany Jn-tad Scares Attorney (AUSA) attorney for Biter being advised of the identities of the interviewing agents and the nature of the interview, provided the following information. was asked if he ever performed any electrical work for a garage apartment owned by ALAN MOLLOHAN. b6 BIC xe. are all artial investors with DéM, which owns a Ramada Inn, located in Fy Morgantown, West Virginia. T Dan has not acquired and does not own any other businesses. MNM Holdings actually owns the land where the hotel is located. invoked his Sth Amendment rights when asked about any personal loans, which may have been secured though D&M. D&M did take out a company loan that was used to make repairs to the lobby and foundation of the Ramada Inn hotel. A bank located in Fairmont, West Virginia provided the loan; however, [__]could not recall the name of the bank. No new loans have been taken out since this loan. ALAN MOLLOHAN had taken a personal loan through DeM paid in full. This information was confirmed bi through the manager of the Ramada Inn, was not sure of the exact amount of the loan, but did not believe it was over Ivesigatonon 02/21/2008 __# Washington, D.C. Fes 58C-WE-233698-302 ~(05_ Date dates 02/27/2008 cB y SA This document consis nethr ecommendatons nor consons of the FOL Is the propery of the Fal end is lanes to your agenoy, ‘and ie contnts er not o be dltbutad oul your open, Moll bs bre b6 BICFD-302a (Rev. 10-6-95) e 58C-WE-233698-302 Continuation of D-302 of +0n.02/21/2008 _,Page 2 b6 $100,000. ALAN had telephoned and informed| lot this loan when ALAN tially wanted to borrow the money. ALAN later also told that ALAN had paid the money back. The cash flow for MNM is generated by the Ramada Inn hotel. [ ] — al Agent Mollohan-934 Ic bs bre be bicFD-302 (Rev. 106-95) FEDERAL BUREAU OF INVESTIGATION Date of transcription _04/07/2008 social security was interviewed at her home residence of Sutton, West Virginia 26601, telephone number eae bein provided the identity of the interviewing agents, provided the following information: [acvised that she assisted with the grant applications for the SMALL BUSINESS ADMINISTRATION (SBA). The assistance she provided included helping with the yearly budget, draw downs of money from the line of credit and reimbursement of the line of credit by providing the bank with a copy of the information sent to SBA. MOUNTAINMADE (MM) received approximately $262,000 per quarter which included operating expenses and artist's products to be sold. The money was received via electronic funds transfer and MM was paid the amount they requested. did not recall signing any checks. MM's payroll was paid utilizing the line of credit. was shown copies of MM checks with her signature beneath signature. said she forgot she had secondary signature authority. did not recall the minimum amount of the check which would Eequize a psecondary signature. the checks were prepared by er instruction. did not know why the funding was sent to the Program Income account. They wrote checks instead of wiring the money because Miners and Merchants Bank charged a fee for wires. advised that [ hada debit card and_was slow at turning in her receipts a estimated that] would eventually turn in 988 of her receipts. On Secasibe, —! used the debit card for personal expenses byt wold reimburse MM. recalled a $60.00 charge which pointed out to saying she accidentally used the wrong card. was questioned about the copies of numerous $9,000 checks written from MM to MM. She said that they wi basically transferring money from one account to another. responded that the bank held funds on checks over $10,000 and MM lmvestgaton on 03/16/2007 _# Sutton, West Virginia ree 50¢~we-233698-302 ~[06 Date detod 03/22/2007 SA ty SA ‘Tis doament corns osthorrconmendelons nr contin 1. Ise propery of the FB at loaned fo your seer Mollohy id ts cals ot be Gaba ce Your spec. 3931.30> b6 bic b6 bye b6 bic b6 picFD-302a (Rev. 10-6-95) 58C-WF-233698-302 Continuation of 70-302 of ,On03/16/2007 _,Page 2 needed to immediately transfer the money. collection was the bank held the funds for 7 or 14 days. (mmm Pte that MM almost bounced checks a few times because the bank held onto the oy contact at Huntington Bank in Elkins, WV was LNU who Is no longer there. reported to bs bie stated that held onto the responsibility for the SBA grant. There was some confusion with the draw down on the SBA funds so at times MM was late in getting the jntopmation to SBA. never saw anything sleazy or shady at mM said there was not any mis-spending of funds had access to MM's accounting system, Quickbooks, so she could look at MM's monetary status on her own. MM did not use the Quickbooks budget section. did not remember if MM could use invoices for product as part of their report to SBA if they had not yet received the product. The candle studio was moved once it was decided MM 6 would build a pottery studio in the basement. The building was bic owned by VANDALIA HERITAGE FOUNDATION (VHF) along with the Peacock Building and the Buckston & Landstreet Building. She was not sure if MM ever finished the pottery studio. was not a part of the pottery studio grant application, handled it by herself. The purcl t MM were created by the buyers. advised that ost of the purchasing, but ny, [ INU, andl also purchased some items. The first buyer at MM that Trecalled was| . was not sure who handled the buying of HINKEL GLASS Products. The owner of HINKEL GLASS was received the product from[___Jand marked received on the be purchase order. It was then approved by Ie entered it into Quickbooks. eS Stud’ re never onterea a purchase order prior to MM recéiving the product. advised that reported to . and “Treported to also reported to stated that she was not told how to answer any questions. Mollohan-938F302 (Rev. 1046.95) FEDERAL BUREAU OF INVESTIGATION . Date of transcription _04/14/2008 {aWostaVirg iia |rencued) =CatenofsDir ch :x| eenemensmsnsnsrer| octal security number: was interviewed at his Place Of employment, JOAN BURDETTE & ASSOCIATES, 25 West Main Street, Buckhannon, West Virginia 26201, telephone number bé IC SO conducting the interview was SEA-O1G SA After being advised of the identity of the nterviewxng agents and the nature of the interview, provided the following information: bookkeeping business in January 1995 first worked on MOUNTAINMADE's annual audit for the time period of July 1, 2003 to June 30, 2004. from TOOTHMAN RICE called requesting that_he conduct the annual audit. MOUNTATNMADE [also ‘called to request his assistance. received name from TOOTHMAN RICE. said the audit took him approximately two to three days and was an Al-33 audit since they received over $500,000 in government funds. mostly dealt with while conducting the audit. As far as could tell, everything looked good at MOUNTAINMADE. MOUNTAINMADE did have a debit card and never saw any irregularities in its use. tied their bank accounts to the balance sheet. Jadvised that he started his own accounting and b6 “" ve It was understanding that MOUNTAINMADE er its line of credit using their inventory and equipment. was told in a letter received June 2006 from that inventory and equipment were used to secure the line of credit. did not recall hearing that MOUNTAINMADE used their grant from SBA as collateral for the line of credit. When| received the grand jury subpoena regarding the ITATIVE (REP.) ALAN B. MOLLOHAN investigation, separately told b3 they had not done anything wrong and the subpoena was bé in regards to REP. MOLLOHAN. bIC Investigation on 10/11/2007 at Buckhannon, West Virginia Fee 58C-WE-233698-302 4{O] ate deated 10/15/2007 by SA b6 bre ‘his acumen coin ser recomendations px concn of he FL_I ee pop he FB andi ened fo your ane: Wand scons re nat © be cstbted cui your agony [ Pp BlOS3.3oD rolendFD-302 (Rev. 1046-95) 58C-WE-233698-302 Continuation of FD-302 of On 10/10/2007 __,Page__2 Durin June 2006 audit of MOUNTAINMADE both b6 Said there were no issues. bre oard of Directors was smaller than normal and knew about lsetting paid as a consultant while on the Board of Director's herself. did not recall why MOUNTAINMADE switched from a debit card to a credit card. As of June 30, 2006, MOUNTAINMADE had a $0 balance at Grant County Bank. bs bre did not know why someone would write multiple $9,000 check to itself on the same day and was not aware that MOUNTAINMADE had done it. []saia that Quickbooks accounting software would allow someone to go back and change the date of transactions. Mollohan-940FD.302 (Rev. 10-6-95) FEDERAL BUREAU OF INVESTIGATION Date of transcription _04/08/2008 social security number be date of birth [was interviewed at bie West Virginta.—ATTer Deing advised of the identity viewing agents and the nature of the interview, provided the following | information: Eve YG pre “ bs bie Investgaton on 03/14/2008 a | West Virginia ' Fle# 58C-WE-233698-302 40 ate deisied 03/19/2008 SAI bs by SA bre “is dace consis ner recimmendaons ner conc Be rope othe FI and is kaned 6 ou esen9; yy Wand contents er not Be atte ouside your age 894 1.8 Od.FD-302 (Rev. 1046-95) ie FEDERAL BUREAU OF INVESTIGATION Date of transcription _04/08/2008 ocial security number dati bs bic of birth was interviewed at West Virginia. After being advised of thé identity nterviewing agents and the nature of the interview, provided the following information: bs bre bs pre Investigation on 03/14/2008 a Huttonsville, West Virginia fies 58C-WE-233698-302 14 vate eas 03/19/2008 x bs © aca bre "dnt ean be zanna rx 8 FL 8 ep oe Fan om Handi ens a ew be tba usd ee 20% FTO REG ZOFD-302a (Rev. 106-95) 58C-WF-233698-302 Continuation of FD-302 of tied to UNITED ST! that received gov any rumors about PROLOGIC came fror projects. On occ: projects and the heard rumors about other companies that were ATES REPRESENTATIVE (REP.) ALAN B. MOLLOHAN ernment money/contracts. [never heard PROLOGIC, most of PROLOGIC’s funding for m out of state sources. never felt any pressure to bill time to certain asion a software was used for two different time could have been billed to either project. Mollohen-945 | ,0n03/14/2008 _,Page__2. bs BIC bé bicFD.3028 (Rev. 10-6-95) 58C-WF~233698-302 timation of FD-302 of n 03/14 /: ‘ bad Cor fro-sozot __| 10n03/14/2008 _,Page__3 Pe did not_recall any illegal or unethical practices at PROLOGIC. never donated to either REP. MOLLOHAN or SENTATOR ROBERT BYRD. PROLOGIC did have a Political Action Committee (PAC) but there was never any pressure to donate to it. Mollohan-946,F302 (Rev. 1046.95) ale FEDERAL BUREAU OF INVESTIGATION Date of tanseripton 04/14/2008. s_interviewed at his place of employment, MINERS & MERCHANTS (M&M) BANK, 13 Bast Avenue, P.O. Box 189, Thomas, West Viyginia 26292, telephone number Also conducting the interview was SBA-OIG SA After being advised of the identity of thi interviewing agents dnd the nature of the interview, ee provided the following information: advised pred ay for MsM BANK since . was not sure af OUNT, i it with MéM BANK. said that would know any details oF > MOUNTAINNADE’S Line of credit. lnvetoston oo 10/10/2007 _# ‘Thomas, West Virginia Fes 58C-WE-233698-302 ~{(O bate Getated 10/15/2007 sal bs easel bre {Te soca anti nite onan or cncnns fe FL Me Henry of he FL and ened Yo our Ben Wand is content ae not o be dui! cusie your epeney. (20/302 2 |ae e e D302 Rev. 10-695) oe FEDERAL BUREAU OF INVESTIGATION was _ipterviewed at_her place of employment, NINERS & MERCHANTS/(MeM) BANK, 13 East Avenue: Box 189, Thomas, West Virgin¥a 26292, telephone number. Rlso conducting/the interview was SEA~ [-—4 After being adfised of the identity of the Interviewing agents and ¢he nature of the interview, provided the following information: was reluctant to answer questions regarding MOUNTAINMADE’S banking relationship with M&M BANK. is thi of MéM BANK. said that shel was the first MOUNTAINMADE employee she met. was asked if anyone at M&M BANK knew about the Date of transcription _04/14/2008 aka numerous $9,000 checks written by MOUNTAINMADE to MOUNTAINMADE in a short time period to include multiple on the same day. have concerns if MOUNTAINMADE did not have sufficient funds. stated that "the girls out front are not trained to catch things like that. was not aware that MOUNTAINMADE was funded by the SBA. reiterated her reluctance to answer any questions due to bank privacy laws. b6 bic bs bic said she was not aware and did not hav: e with it (> as long as MOUNTAINMADE had sufficient funds. Te frena fe) Imesionson on 10/10/2007 __# Thomas, West Virginia res S8C-WE-233698-302-(\\ bate dewtod 10/15/2007 SA ‘This document contain ner recommendations nor conclusions of th FB. il the property of te FBI and i loaned to your ageey 1 and ts corknts are not tbe dtbted uti your agen Bi Db2. S65 Molla bé bicmanpe.06% e ® FEDERAL BUREAU OF INVESTIGATION seripion 04/30/2008. date of birt social security numbe: me telephone number 9: Charleston, st Virgini so conductihg the interview was SBA-OIG SA agents and the naturp of the interview, provided the following informatioh: cellular teleph i was interviewed al rex hot After beidg advised of the ne the interviewing advised she was hired at the National Technology Transfer Center (NITC) for a special project which later became MOUNTAINMADE (MM). UNITED STATES REPRESENTATIVE (REP.) ALAN B. MOLLOHAN initiated the special. project for the purpose of gaining experience building an e-commerce website. MM became a 501(c)3 nonprofit organization in 2000. ]was the of WM until she left in 2007. then became where she stayed until early 2008. Duties Tncluded: manage a staff of 19, work with Board of Directors (BOD), manage budget, complete SBA grant applications, handle SBA quarterly reports, some purchases, and decisions on employee salaries. The members on the MM BOD were, who _also served a: DP. MOLEOHAN also attended many BOD meetings or else he would send REP. MOLLOHAN's to the meeting. worked for the ENVIRONMENTAL PROTECTION AGENCY (EPA) in organtown, West Virginia. All decisions regarding MM's business, policy, and direction made by the MM BOD were presented to REP. MOLLOHAN prior to the official decision. REP. MOLLOHAN made all important decisions relating to MM's business, policy, and direction. The only exception was when REP. MOLLOHAN wanted to build a butterfly farm. felt there was an appearance of impropriety on the BOD based on REP. MOLLOHAN's relationship with each member of the BOD. advised that the BOD decided to keep the MM location in Stonewall Resort because of recused herself from voting on the decision, but xcentage of bé bIc v6 bic ‘nvostoaton on 2/25/2008 _t Charleston, West Virginia Fle# 58C-WE-233698-302 —\\O Dele dictated 2/28/2008 y SA ‘Tis document contains nether recommendations nor concluslons of the FBL I isthe property of the FBI and is loaned to your agency: Wand ts contents are not fo be eetibuted outs b6 bre bé bic Moll foe si7e 2.302D.3028 Rev. 10-6-95) @ 58C-WF-233698-302 ‘Continuation of FD-302 of gross sales at Stonewall Resort was greater than the rent. »0n 2/25/2008 _,Page _2 had to recuse herself from voting because VANDALIA HERITAGE FOUNDATION (VHF) provided grant money in the construction of the space for MM, The developer for the Stonewall Resort was used to work for MCCABE-HENLEY anc v6 was employed by MCCABE-HENLEY at the time. bre was brought in by REP. MOLLOHAN as a consultant to NM. worked at the Center for Non-Profit Law. When left MM, it was assured of funding through September 2008. LNU, a REP. MOLLOHAN| telephoned before she left MM and told her thal Would not. ever yéceive earmarks through REP. MOLLOHAN's office again. The funding was also cut off to the other non-profits, WEST VIRGINIA HIGH TECHNOLOGY CONSORTIUM FOUNDATION (WVETCF), VHF, CANAAN VALLEY bé INSTITUTE (CVI), and INSTITUTE FOR SCIENTIFIC RESEARCH (ISR) . bre When the investigation hit the media, received a deposited into another MM account. skixt the bank's check-hold policy. were written against one MM account, made call from the New York Times. felt_that the investigation was a part of a master game plan by was not aware that REP. MOLLOHAN owned land in ‘North Carolina until it was reported by the media. jadvised that she had REP. MOLLOHAN's cell phone number and on occasion telephoned him whenever she wanted to share good news regarding MM Jalso spoke with and emailed| was questioned about several $9,000 checks that bs ayable to MM, and then bre explained that those checks were used to reimburse MM's program income account. The checks were written under $10,000 because their bank's policy was to place a hold on all checks over $10,000. [______] MM's former came up with the idea of writing checks for $9,000 to stated that [__]was in over her head when it cane to managing W's finances Wits outside accounting firm was TOOTHMAN RICE. Jo TOOTHMAN RICE suggested that [__] be fired because of her inability to handle the job. ea was questioned concerning her use of MM's debit card to purchase personal items. bic was shown a copy of the Mollohan-950,roan 0605 e ® 58C-WF-233698-302 CCoainuaion of F302 of .0n.2/25/2008 __, Page _3 color coded spreadsheet, created which outlined the personal purchases made by using the MM debit card. oT stated that she made the purchases and that it was wrong to also stated that she knew it was wrong at the time she made the purchases. also admitted that any reports filed by MM with the S] ig the time of the purchases, would have not been accurate. poe ea ‘the forms that were submitted to the SBA, knowing they were inaccurate because of her purchases. explained that when the debit card issue was presented to MM's BOD around March 2006, she presented the BOD with a letter of resignation. Everyone on the MM BOD was aware of the purchases made by| stated that she then received a telephone call from REP. MOLLOHAN regarding her resignation. REP. MOLLOHAN told| that he needed to speak with her. said she Speak because she was crying. REP. MOLLOHAN asked to come over to his house. drove over to REP. MOLLOHAN's house in Canaan Valley, West Virginia. When she arrived at the house, REP. MOLLOHAN had a list of personal items that had purchased using NM's money. REP. MOLLOHAN told[———] that if she quit, it would be like an admission of guilt. REP. MOLLOHAN also said that he did not want her to quit and that he would work with ]to get her through this issue. told REP. MOLLOHAN that she would stay on with MM. BuESTASS personal items using the debit card/SBA grant money. advised that while she was at REP. MOLLOHAN's home, UNITED STATES SENATOR ROBERT BYRD, West Virginia, called REP. MOLLOHAN about his wife, ERMA BYRD. SENATOR BYRD told REP. MOLLOHAN that ERMA was dying. Also_while was at the house, REP. MOLLOHAN received a call from regarding an automobile. After the meeting, Jto1a of her decision to remain with the organization. suggested that = take some time off. also shared her decision with who was supportive of her decision to stay. veimbursed MM for the items she marked as personal. was_questioned regarding MM's line of credit at Grant County Bank. stated that the original line of credit was opened through Huntington National Bank by her predecessor. After — denying any culpability regarding the line of credit, admitted that she used the SBA grant money as collateral for the line of credit. knew that MM was not b6 BIC bé b7c bé Ic Mollohan-951FD.302a (Rev. 1046.95) 58C-WF-23: Continuation of FD-302 of 3698-302 On 2/25/2008 _,Page_4 allowed to use the SBA grant as collateral for a loan or line of credit. put together a sustainability report for MM so it would not have to rely on plan was opening a Prior to the media reports of an investigation, (__] Me c for its existence. Assisting her with the Her plan included WM location at Cabela's, a hunting and fishing supply store. Ipresented this plan to MM's BOD before she resigned, also utilized as a subcontractor for MM. checks made out _to interest for tobe paid as a subcontractor ep the BOD. BOD positions at MM were non-paying positions. federal programs consultant and also did work for VHF, ISR, and MM stopped using| WVHTCF. however, she did not know what became of her plan. (7-1 saia that[_______] was on the mM BoD and recalled signing and she thought it was a conflict of was used as a A bye as a subcontractor after the media xeports regarding REP. MOLLOHAN. [7 ™aavised that rsp. puring the meeting when ISR was removing L_——_—__} President of ISR, was sending updates to REP. MOLLOHAN via text message. [———Jwas also on the BoD at According to CVI is 98% federally funded. CVI jas purchased some property adjacent to property owned by REP. MOLLOHAN. area to prevent growth like strip malls and maintain the was then to have VHF purchase property in the same environmental quality of the area. attending a meeting at CVI with developer from Washington, DC. VHF plan. Thomas, West Virginia riverfront, : cog ‘VEF also funded a plan for recalled REP. MOLLOHAN, and a Se Wayor of Thomas was against the advised that when VHF purchased a building for 1,000,000 Exom as against the purchase. told [ hat REP. MOLLOHAN made )VHF purchase the = Bullding tom Jwas then supposed to the space he was using in the building but be pay rent for iled out after VHF purchased the building. ] also told to never trust talk about @ former VHF employee P. MOLLOHAN's involvement in the purchase of the also heard Building. felt that was closer to REP. MOLLOHAN than was and that did not like each other. be bic Mollohan-952rotten @ e 58C-WF-233698-302 Continuation of FD-302 of On 2/25/2008 __,Paye__5. ——] said that at some point! was fixed from MCCABE HENLEY and was working on is own in an office at the Highgate building. b6 pie is a former architect for VHF. did itectural plans for REP. MOLLOHAN's house in Canaan Valley. was told byl] a part-time employee at VHF, that someone erased the architectural plans of REP. MOLLOHAN's house off of the VHF server. is still close to REP. MOLLOHAN. jJalso did some work on REP. MOLLOHAN's house. Mollohan-953aes e e ele FEDERAL BUREAU OF INVESTIGATION Date of transition _04/02/2008. | Fairmont, bs West_Virgint® social Bic th: security number. ri employment, 13 Corporation, 305 was interviewed at Cleveland Avenue ppace_o: ion, Clarksburg Resident Agency. ity of the interviewing agents, nformation: Pittsburgh Divi, being provided the ide provided the following be pre One of the proposals that [_______] worked on was the Independent Validation and Verification (IV&V) proposal. was part of the Proposal Management Center at PROLOGIC, Which organized the submitted proposals. The PROLOGIC, [ ] used to him in writing and/or preparing for briefs and meetings. (th cored for the best ways to grow the company. informed jabout Small Business Innovative Research (SBIR) grants. jprepared proposals for SBIR grants often and recalled doing them for did not work on the proposal for the Lidar project. worked on projects only prior to receiving the grant. Once the grant was awarded, he moved onto other proposals. bé bre first heard about the PROLOGIC investigation when he received an email from his friend, The email referred him to an article on the internet regarding PROLOGIC using public funding to develop commercial software. Investigation on 02/27/2008 at Fairmont, West Virginia File # 58C-WF-233698-302 WS Date dicated 02/28/2008 bé Te by _SA ‘This document contains nether recommendstions nor conclusions of the FBI. It is the property of the FBI and is loaned to your ag i it and is contents aze not to be distibued outside your == bi 1401, 32a érosin. 18659 e ® 58C-WF-233698-302 (Continuation of FD-302 of »0n.12/7/2006 _,Page__2 The culture at PROLOGIC was that the value of intellectual property outweighed the value of the employee because employees leave but, FROLOGIC owned the intellectual property. said that believed that as well. eet wrote a document that was edited by which, is opinion, was a pre-meditated approach to use public funds to develop commercial software. as aware of the thin line regarding SBIR grants. believed that felt he was acting with the best interest of the client. [——etonatea to the PROLOGIC Political Action Committee (PAC) but was not aware of the amount. donated $5.00 per check to the PAC. asked [ ] tptake a nosirion ata "high tech 46 center" in Hinton, West Virginia. duties were to work pic on a United States Navy contract where PROLOGIC was a subcontractor to MANTECH. The contract was funded by an earmark from UNITED STATES SENATOR (SEN.) ROBERT BYRD via a single line appropriation. SEN. BYRD had previqualy used @ separate earmark to build the "high tech center." “When asked[__]what his daily duties would entail, he was told that it was a "body shop." described a "body shop" as being a place created by an earmark or other method of receiving government funds for a specific purpose but either no work or other work not related to the earmark is worked on instead. The purpose of the multimillion dollar earmark sent by SEN, BYRD through the U.S. Navy to MANTECH was to create computer based training as a replacement of the current U.S. Navy paper manuals. quessed the total amount of the earmark to be $3,000,000. never saw a deliverable. |worked 40 hours per week Z000 and 2001 for an approximate total of 1.5 years. salary at the time was $45,000 per year and he ®6 estimated that PROLOGIC billed MANTECH $80 to $120 per hour and bic MANTECH then billed the U.S. Navy. There were also 10 to 12 other people working on the project, the majority of which were MANTECH employees. ee Ee other employees from COMPUTER SCIENCE CORPORATION (CSC) also working _on the project. The project was directed by two MANTECH employees, recalled. being from Minnesota and was From Rochester, NY. had a Nursing Degree and was removed/fired from his position in Hinton in 2002. Mollohan-955,reste. @ ® 58C-WF-233698-302 Continuation of FD-302 of On 12/7/2006 _,Page _3__ One of the projects unrelated to the earmark that was billed to the earmark was the creation of a Gun Safety Video, which was used by MANTECH. advised he also wrote four to six proposals used in attempt to win separate projects to include a CBT and BLUEFIELD COLLEGE. when MANTECH asked o write a proposal, he would call| to request b6 permission to the proposals and also gather some bre information. poe pota that he could work on proposals for new work as_long as PROLOGIC was hi as the subcontractor on the proposal. stated thee Po Jaeeinively knew that MANTECH was billing the U.S. Navy for the work even though it was unrelated to the intended purpose of the earmark and was actually proposals for other projects. [_____]said that he did not have the clearance to work on the intended purpose of the earmark. Eventually, [——_] wanted out of Hinton and| attempted to fire eles for unemployment, PROLOGIC challenged the unemployment claim and finally ended up re- hiring As far as knows, MANTECH is still in Hinton. said he once completed a project for Carnegie Mellon. He built the courses on emerging technologies even though he knew nothing about computers. He basically read textbooks, made 6 a PowerPoint and someone from PROLOGIC taught the course as part of »7¢ continuing education for professionals. never understood how PROLOGIC got the contract. Jadvised that he wrote the proposal that helped allow PROLOGIC to take a U.S. Department of Bnergy (DOE) contract away from DN AMERICAN. PROLOGIC was a subcontractor to DN AMERICAN for years but then [____]made some accusations against DN AMERICAN to the Small Business Administration (SBA), who investigated the allegations. Apparently that was enough to prompt DOE to award the $40,000,000 contract to PROLOGIC. According to sa hight respected engineer so PROLOGIC named| as on all contract proposals felt he was being abused for billing purposes but did not know if was mis- billed. lived in the Clarksburg or Bridgeport, WV area. v6 advised that had been a PROLOGIC bre employee fo and knew everything about finance within PROLOGIC. [|] knew about PROLOGIC billing MANTECH in Hinton. Mollohan-956,epatna 0698 e ® 58C-WF-233698-302 Continuation of FD3020f __| »On 12/7/2006 _,Page__4 said everyone at PROLOGIC was surprised when they found out was on the payroll at PROLOGIC. — never did any work and never talked ee work with bre Another potential "body shop" that is associated with PROLOGIC is in their Uniontown, PA location, which is in U.S. REP. JOHN MURTHA's district. Mollohan-957FD.302 (Rev, 10-6-95) aie FEDERAL BUREAU OF INVESTIGATION Date of transcription _07/03/2008 West Virginia 26241, wofk telephone number social security numbe [date of birth t was interviewed at h¥s place of employment, Huntington National Bank Draver 1279, Elkins, West Virginia 26241, telephone be number ‘Also participating in the interview was bre Small Bui Tress SRT Tistration (SBA) Office of Inspector General (oTg) sa After being provided the identity of the interviewing agents, provided the following information: advised that he en Huntington National Bank (HNB) since was called by the accounting firm TOOTHMAN RICE approximately five to six years ago. TOOTHMAN RICE was inquiring about setting up a line foredit for one of their clients, MOUNTAINMADE (MM) . 6 thought of TOOTHMAN RICE as a reputable company. bre met with mm L Jana they set up a line of credit and a couple of deposit accounts. ir inventory to help obtain the line of credit. From perspective, the line of credit was unsecured. MM directed the proceeds from_the SBA grant to the deposit accounts at the bank. MM gave L———-]a copy of the SBA grant award notice, which was a contingent on the line of credit. recalled that was easy to work with and had a good response when ENB made requests. r was al sending the financial statements to HNB. bs as || took over for [——_] was always late bre in sei ng financial statements, If they sent them at all. HNB employees were told by the MM accountant that she was told by Peito not send the financial statenente to. HNB Co was the only one who should send them to HNB. jould not respond to messages left by wanted a copy of the SBA quarterly draw reques pa the SBA directly and talked to an unknown male. was told that MM had not submitted a correct bs bic Imvestosion on 10/11/2007 _st Elkins, West Virginia ret 5aC-wr-233698-302-WN4 Date detsted 10/30/2007 “his eccumot contains rather conerandaons noe concuions Ike te pany of te Fan is taned to your agency, i ad te contents are otto be dined ouside your agerey. SsFD.302a (Rev. 10-695) 58C-WF-233698-302 Continuation ofFD.302 of __| On 10/13/2007 _, Page request for three quarters or nine months. said that SBA was aware of the line of credit but was not sure if the SBA mew that MM used the SBA grant as collateral for the loan. After talking to the spa, [ alled me at MM, to inform ae) (‘Bilof the incorrect quarterly requests made to the SBA by MM. never heard from again. jstated that he cannot and did not base any credit decisions on the support UNITED STATES REPRESENTATIVE ALAN MOLLOHAN gives to MM. The MM line of credit went through the normal underwriting process at HNB. HNB filed a UCC report on the receivables and inventory at MM. reiterated that he would not have given MM a BS line of credit without the SBA grant. knew that HNB bre could not get any money from the SBA grant assignment if MM was unable to pay off the line of credit. aid that] lis no longer the of MM. Mollohan-959¥D.302 (Rev, 10-6-95) FEDERAL BUREAU OF INVESTIGATION Franklin, West Virginia 26807, cellular telephone number social security number date of birt was interviewed this place of ‘oyment, Grant County Bam! pricam Avenue, Davis, Wést Virginia 26260, telephone number Also participating in the interview was Small Business iministration (sBa) Office of Inspector General (OIG) sa Aftefr being provided the identity of the interviewing agents, ovided the following information: advised that he began working at Grant County Bank (GCB) in 2001 when it was known as The National Bank of Davis. GCB bought the bank approximately two years ago. current title was was the main contact for MOUNTAINMADE (MM)_durink the time they were customers_at Grant County Bank (GCB). recalled that he dealt with! from MM. MM said they were switching banks because they were not satisfied with their former bank located in Elkins, West Virginia. MM originally opened a checking account and eventually opened a line of credit for approximately one year which they never used. estimated they had the line of Greait from October 2006-tOOetober 2006. [——Jsaid the line of credit was an average amount compared to other customers of the bank. ad authority to grant a $50,000 loan but the process for the MM line of credit would have been to gather all pertinent information from MM then present the information to the GCB Board of Directors in Petersburg, West Virginia. stated that MM secured _the line of credit with the grant they received from the SBA. was not_aware that MM was not allowed to use the SBA grant as collateral for a loan. [_——]said he would not have allowed MM to get a loan if he had known they could not use the SBA grant as collateral. xecalled MM telling him that the assignment of the SBA grant would pay off the line of credit. b6 bye 6 Ic lnvestgton on 10/11/2007 _# Davis, West Virginia Ret 58C-WF-233698-302 WS Dale aeated 10/30/2007 SA ‘This document contains nether recommendations nor concslons ofthe FBI IIE the propery of te FB and ie loaed to your agency M eed cos ae et w be sabes te vor spews TO’ (AO SOD, b6 BIC bs 7.FD-302a (Rev, 10-695) 58C-WF-233698-302 Continuation of FD-302 08 _| On 10/11/2007, Page _=2- did not have the file on MM but told the agents to contact in Petersburg, West Virginia a be bic listed the GCB Board of Directors who would have approved the line of credit for MM: Mollohan-961FD-1003 (Rev. 622-2007) FEDERAL BUREAU OF INVESTIGATION Confidential Human Source (CHS) Reporting Document Reporting Date: 08/28/2008 aC-WP-233698-302 (Pending) We case I (Pending) bs bic Contact Date: 07/21/2008 bID Type of Contact: Telephonic Location: Written by: SA Other(s) Present Source Reporting: bé eg) bIe 7D _P® D414. wed Mollsoit on soz 6 .. e FEDERAL BUREAU OF INVESTIGATION Confidential Human Source (CHS) Reporting Document Reporting Date: 09/24/2008 Case ID: 58C-WF-233698-302 (ending) “| (Pending) Contact Date: 09/03/2008 Type of Contact: Telephonic Location: Written by: SA Other(s) Present: Source Reporting: ” mae i wed Moll bé bic BID b6 Ic BID bs BIC' F302 (Rev. 106-95) FEDERAL BUREAU OF INVESTIGATION 2 # Date of transcription _09/25/2008 y dave of birth: ial security number: home residence: Charleston, West Virginia 25301, home telephone: cell: | iL was interviewed at phe law offices of Bowles Rice McDavid Graff & Love, 600 Quarri¢r Street, Charleston, West Virginia 25325. Also present during the Anterview was | After being Advised of the identities of the interviewing agents and the nature of the interview, provided the following information: advised that he moved _to Charleston, West Virginia in 1997 and worked for MCCABE HENLEY. xovided technical advice and managed brick and mortar construction projects. left MCCABE HENLEY in the middle of 2000 and he was hired as a b6 BIC Ic consultant for VANDALIA HERITAGE FOUNDATION (VHF). After approximately 18 to 24 months, left VHF and moved to the Washington, DC area where he Seen Ewo to three years before TI returning to West Virginia. was rehired as a contractor by VHF to train their employees until VHF ran out of funds for his position in January 2008. spent the majority of his time at VHF reviewing the work of provided oversight and advice on projects that were working on. was unhappy with being reviewed and eventually! left VHF because he was being reviewed. felt this was a quality control issue. - Even though no longer works with VHF, he does remain friends with VHP. recalled that VHF worked on the construction of the INSTITUTE FOR SCIENTIFIC RESEARCH (ISR) building assisted with the program of requirements for the building an worked as an owner's representative with MASSARO, the construction company on the ISR building. [___]never dealt with the "soft side" (financial/budget) of the building. 3 e did not assist in response to the Grand Jury Subpoen: eceived in regards to the investigation on Imvesignion on _ 07/23/2008 Charleston, West Virginia Fie # 58C-WF-233698-302 AIS Date disted 07/29/2008 wy SA his eee: cone nes remands nor ann fhe FB he propery of te FB adi ae 1 your be it and its contents are not to be distbued outside [piss == be bye b3 bé bre 6 | BICtos e rosin 10695 58C-WF-233698-302 Continuation of FD-302 of U.S. REPRESENTATIVE ALAN MOLLOHAN. the Grand Jury Subpoena. advised that allowed to work on any plans relat .0n.07/23/2008 * .Pege__2 handled the response to had told him that was not MOLLOHAN during business hours. to personal work for REP. said that was already working on plans for a house being built by REP. MOLLOHAN. [stated he never saw the plans for REP. MOLLOHAN's house and had no knowledge whether or not worked on them during business hours. stated he never saw nor heard of any architectural plans for REP. WOLLOHAN being deleted off the VHF server to include any plans created by said that took everything he could with him when he Teft VAF_ LJ described stayed at the garage apartment located on REP. MOLLOHAN's property while working at VHF. said he stayed at the apartment voluntarily and paid REP. MOLDOHAN $825 per month. Po aes a stickler for keeping the be b’ apartment and other VHF related activities straight. said that was a gregarious person and a broker. had no experience with any shady dealings when dealing with| Mollohan-966, b3 b6 yc b6 bic 6 7C