Authorities mum on former CFO's role in kickback scheme prosecution

Authorities were tight-lipped Thursday about why former DeWitt Company CFO Richard Potter has not been criminally charged in connection to an illegal kickback operation they allege he was involved in for at least three years.

Jason Mitchell of Jackson, formerly employed with DeWitt, and Rajiv Toprani of Clarksville, Tenn., the owner of a textile supply company that partnered with the Sikeston, Mo., company, were charged Tuesday with felony stealing. The pair allegedly ran a kickback scheme which led to the transfer of more than $500,000 in a fraudulent bank account from 2007 to 2010.

Sikeston Department of Public Safety detective Andy Caton wrote in an affidavit filed in Cape Girardeau County that Potter admitted to him in an interview that he participated in "doctoring" company financials to make it appear that the kickbacks he and Mitchell were receiving were legal.

Caton, who investigated the case with the Missouri State Highway Patrol for six months, wouldn't elaborate Thursday whether there would be charges on Potter in the future. Caton said the case is still an open investigation and he couldn't discuss other than what is already in court documents.

"There's several leads that we're following up on now. Until we close the case, there's no other information to give out," he said.

Cape Girardeau County Prosecuting Attorney Morley Swingle said Tuesday after filing charges on Mitchell and Toprani that the details of the case were in the affidavit and he'd not comment on charges related to Potter.

Potter admitted additional details of the operation, according to Caton, including a second figure -- $950,000 -- which he said he and Mitchell received in their Bank of America account from 2003 to 2007. The kickbacks allegedly came from Toprani, owner of KT America, a company that has sold more than $56 million in materials to DeWitt since 2001. The kickback varied, too, Potter told Caton, according to what fabric was purchased and Toprani's profit margin. The average amount was around 3 percent of the price.

Caton wrote in his probable cause statement that Potter also admitted participating in the operation to Larry DeWitt, CEO of the company that mainly supplies products and fabrics to the lawn and gardening industry. Caton said that Potter told Dewitt in May that he and Mitchell were splitting the kickbacks and that he was receiving 40 percent.

Meredith Dewitt, the company's vice president, said her father fired Potter after their May meeting. Potter, who started with the company in 2000 as an accounting manager, became CFO in 2007, when their former financial officer retired.

Dewitt said the former CFO recommended Potter to take his place. She also said Thursday she also didn't understand why Potter isn't facing criminal charges.

"He apparently was the one who gave all the information and maybe that's why, I don't know," she said. "If there's a deal made there's nothing we can do about it. Since he gave [police] their information, that's what I would assume."

Still, Dewitt said the situation is confusing and wouldn't know what to feel if that is why Potter isn't facing criminal charges at this time.

"He's going to be the one that has to lay his head down at night. I guess it's his conscience, not mine," she said.

She expects the company to be filing a lawsuit, that would most likely include Potter, Mitchell and Toprani, soon. Dewitt said they're still holding meetings with their lawyer.

At his initial arraignment Thursday, Toprani was given more time to find counsel. Appearing with his attorney Stephen C. Wilson, Mitchell had a preliminary hearing set for March 10.

Circuit Court Judge Gary A. Kamp also granted Mitchell a bond reduction, allowing him to post 10 percent of his $250,000 cash-only bond. Bond was posted Thursday, according to Missouri Casenet. Kamp set several special bond conditions, including an order for Mitchell to use an alcohol monitoring device while on release.

ehevern@semissourian.com

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