Jabari Edwards is asking a federal judge to dismiss asset forfeiture claims against his businesses arising from his June arrest by the Federal Bureau of Investigation for wire fraud, conspiracy to commit wire fraud, money laundering and making false statements.
Edwards and his business partner, Antwann Richardson, were arrested in June for multiple charges relating to allegedly misusing more than $2 million in Paycheck Protection Plan and Economic Injury Disaster Loan program loans. The loan programs were intended to help maintain employment rates and assist businesses recovering from hardships as a result of the COVID-19 pandemic.
The FBI, as well as other state and federal agencies, raided J5’s headquarters in downtown Columbus on June 16.
On Oct. 6 Columbus attorney Wilbur Colom filed a motion to dismiss the forfeiture of assets on behalf of J5 GBL, J5 Solutions, Edwards Enterprises, The Bridge Group, BH Properties and Build Development Group, all companies owned by Edwards. The motion seeks to dismiss the forfeitures, not the charges against the businessmen.
As part of the federal indictment, bank accounts with Cadence Bank and Bank of Vernon connected to those companies were forfeited in addition to Court Square Tower and other real estate. Colom is arguing that, first, the “…operating accounts…were frozen, impeding their business interests and survival,” and, second, that the government can’t prove that questionable expenditures were actually made with the loan money.
Investigators alleged Edwards and Richardson filed false claims for pandemic relief funding on behalf of North Atlantic Security in January 2021, but that the company was sold to American Sentry Security Services in March 2021. The money they got on NAS’s behalf was allegedly used for personal real estate transactions, including buying Court Square Tower, political contributions, charitable donations, buying vehicles and lump sum payments to friends, family members and other companies.
The defendants’ argument
Colom argues J5 Solutions’ only function was to make payments on behalf of all the companies under the J5 umbrella, “…which were and are housed in one building and share a number of common employees.”
Payments the government claims were made unjustly with loan funds were actually made with money from other sources, Colom argues.
The indictment claims “…on June 10, 2021, $48,000 was transferred from Solutions to (Edwards’) personal account,” Colom writes. “…The day before this transaction…Greenfield Environmental Multistate Trust wired J5 GBL a payment for work performed in the amount of $109,394.” Greenfield is responsible for the cleanup of the Kerr McGee Superfund site in Columbus, and various Edward’s-connected businesses have been awarded related contracts.
Similarly, the indictment alleges that on July 9, 2021, J5 GBL transferred $125,000 to The Bridge Group. Colom argues that bank records “clearly show that on July 7, 2021, J5 GBL received a payment from The Trust for $434,675.”
Colom argues that in neither case did the government show the money involved was loan money. He also argues other transfers referenced in the indictment were “normal business transactions” and not illegal, and checks cut to Richardson, Shanta Blakney, Sophia Erby and Jewel Edwards were bonuses.
“The United States has made no allegations that any of the transfers to sister companies were not business related or even impermissible under the terms of the notes” to the Small Business Administration, Colom wrote. “As for year end bonuses, the giving of bonuses is an ordinary business practice.” The referenced checks to family and friends had “I love you” written in the memo line according to the indictment.
Throughout his motion, Colom argues the laws governing how PPP and EIDL money could be spent are vague.
“At no point in the note does it place specific restrictions on the use of loan funds,” Colom writes. “The only restriction is that it must be used for business purposes.”
Court Square Tower
In the indictment, the government alleges the January 2021 purchase of Court Square Tower for $1.2 million was improper.
The building, located at 605 Second Avenue North, was seized as part of the indictment.
The property was formerly owned by Court Square Tower LLC, a company controlled by Colom himself, according to the Mississippi Secretary of State’s website. Court Square Tower LLC was listed as dissolved in 2017, yet it owner-financed the sale of the property to an Edwards-owned company, according to documents included with Colom’s motion. The final balloon payment for the purchase is due from Edward’s company to Colom’s company on Dec. 31.
“…using EIDL funds to purchase Court Square Tower is certainly business related,” Colom argues. “What is illegal about doing so? Nothing, as businesses purchase buildings on a daily basis in the United States.”
Colom also posted bond on June 16 for both Edwards and Richardson on behalf of Jewel Edwards.
Edwards and Richardson have also been granted a second continuance. Trial had originally been set for July 25, but was reset for Nov. 14. Edwards’ attorney, Donna Smith, has twice requested the case be continued due to the time needed to prepare for trial, including reviewing over 10,000 pages of discovery.
Smith also serves as a public defender, and one of the court terms when she is required to be in court in Lowndes County is in November.
Trial is set for Jan. 23, 2023, at the federal courthouse in Oxford.
Brian Jones is the local government reporter for Columbus and Lowndes County.
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