- Associated Press - Monday, February 10, 2014

HATTIESBURG, Miss. (AP) - Former D’Iberville manager Michael Janus pleaded guilty Monday to one charge of defrauding the city of $180,000 in grant money, setting him up to testify against business partner Scott Walker.

Janus admitted guilt before U.S. District Judge Keith Starrett in a hearing in Hattiesburg. He had originally pleaded not guilty.

Former Ocean Springs mayoral candidate Scott Walker and Janus were indicted in November on five counts: conspiracy to defraud the federal government, fraud, bribery and two counts of money laundering. Cliff Johnson, Janus‘ lawyer, said after the hearing that the other four counts against Janus will be dismissed as part of the plea agreement.

Janus will be sentenced May 6. He faces a maximum of 10 years in federal prison, a fine of $250,000 and three years’ probation. Prosecutors are likely to recommend a lower sentence, but Assistant U.S. Attorney John Dowdy declined to disclose the recommendation Monday, saying Starrett had sealed it.

Dowdy told reporters the government wants to force Janus to repay the money and said Janus has agreed to testify against Walker in his trial, which is scheduled for March 10.

Janus remains free on bond and did not speak to reporters.

“It’s been a big day, a hard day, for Mr. Janus,” Johnson said.

Walker also faces charges in a separate case of misusing public money controlled by the Mississippi Department of Marine Resources. Also charged in that case are Walker’s father, former Department of Marine Resources Director Bill Walker, and two other former DMR officials.

According to a January court filing by Walker’s lawyer, Janus admitted guilt to FBI agents more than a year ago.

In court Monday, prosecutors said that at trial, they would have proved that Janus and Scott Walker worked together in 2011 to defraud D’Iberville of $180,000 and used part of it to pay off their business debts. Assistant U.S. Attorney Jerry Rushing told Starrett that Janus tried to get consulting firm Gouras & Associates LLC to create a fake invoice for a 6 percent finder’s fee on a $3 million grant from the Mississippi Department of Environmental Quality to D’Iberville. Janus wanted the company to give Walker 80 percent of the money, but the company refused. Rushing said Janus and Walker then signed a backdated contract between D’Iberville and Maxwell-Walker Consulting, a company controlled by Walker and Pascagoula Mayor Robbie Maxwell. After the company cashed the check, Walker sent $90,000 to JaWa Investments LLC, a company Walker and Janus jointly formed in 2010.

Of the $90,000, $40,000 went to pay off money JaWa had borrowed to buy a share of Biloxi’s Columns Bar. The other $50,000 went to pay a debt that prosecutors didn’t explain.

When Starrett asked whether prosecutors’ account was true, Janus said: “To the best of my knowledge, these facts are true.”

That wasn’t a straightforward admission of guilt. After Janus explained that he didn’t know what officials from the Department of Environmental Quality and other agencies had told prosecutors, Starrett asked again if what prosecutors said was true, and Janus said “yes.”

“Your honor, I plead guilty,” he said.

___

Follow Jeff Amy at https://twitter.com/jeffamy

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