LaRoque convicted of federal theft, fraud charges

Former state Rep. Stephen LaRoque was convicted today on a dozen charges related to the theft of funds from a federally-funded rural business lending program he ran for more than a decade in the eastern part of the state.

LaRoque, 49, a Kinston Republican, was convicted by a federal jury of

Stephen LaRoque after a 2012 court appearance.

Stephen LaRoque after a 2012 court appearance.

four counts of stealing from the federal program four counts of laundering the theft through financial transaction, two counts of concealing the theft and two counts of filing false statement on tax forms.

LaRoque showed little emotion upon hearing the guilty verdicts, according to WNCT reporter Katie Banks, who was in the courtroom.

His sentencing will be in September, and he was released on bond until then.  He faces a maximum punishment of more than 90 years in prison, along with significant fines.

LaRoque, a co-chair of the powerful House Rules Committee, had been in the N.C. House of Representatives until his July 2012 indictment, when he resigned.

The crimes were related to LaRoque’s management of East Carolina Development Company and Piedmont Development Company, two non-profits founded by LaRoque that receive $8 million in U.S Department of Agriculture funding to lend money to small businesses struggling in the state’s rural areas. But LaRoque profited significantly from running

the charities, taking in an estimated $2 million in compensation over the years.

Evidence in the trial showed that LaRoque took $300,000 from the non-profit to buy a house for his stepdaughter, a portion of a Greenville ice-skating rink, expensive jewelry, replica Faberge eggs and two cars.

LaRoque had testified to jurors and insisted the money was his, from contracts he had with the non-profits.

A federal grand jury began its probe of LaRoque after the August 2011 publication of “Public money, personal gains,” an N.C. Policy Watch investigation. The Policy Watch piece, using public records as its basis, found that LaRoque had received salaries much higher than his counterparts while running a lending organization that arranged loans to close associates, including then-state Sen. Debbie Clary and state Rep. Mark Hilton. Clary used the money to buy a Shelby building for her marketing firm while Hilton bought a number of mobile homes for a mobile home park. Neither sought reelection in 2012.

LaRoque’s board of directors consisted of himself, his wife and brother, despite IRS and USDA rules that frown upon such conflicts of interest.

The Policy Watch investigation also found that USDA’s oversight was lacking, and that USDA officials failed to properly monitor how LaRoque was benefiting from the non-profit.

7 Comments

  1. jlp75

    June 7, 2013 at 2:44 pm

    Congrats NC Policy Watch. Thanks for shining the light on this elected official’s criminal behavior. Please don’t stop there. I am sure the General Assembly can really use a good Spring cleaning.

  2. Jack

    June 7, 2013 at 3:27 pm

    Here a republican had the opportunity to fund rural businesses that could have maintained employment and keep small businesses from going under. Instead LaRougue’s sense of entitlement got the better of him. How ironic.

  3. hmmm

    June 8, 2013 at 2:51 am

    Thank you for showing the world exactly what kind of person this individual is. He always has been one who thought he was in a realm above everyone else.

  4. Jeff S

    June 8, 2013 at 4:39 pm

    Now we prepare for the white-collar slap on the wrist.

    Bet you $100 there’s someone sentenced the same day to more time for stealing a fraction of the amount.

  5. Doug

    June 9, 2013 at 1:08 pm

    jlp,
    The policy crotch shining light? This was covered by most of the mainstream media, although I would not dispute that few saw it through those means….or really even here judging by the low traffic of the site on most days….because almost no one outside the radical left progressives believes the MSM any longer. But yeah, now we need to get he PC here to cover all the political corruption, even the democrat side of things too. Corruption is far from being a policital view, it is at the core ofalmost every politician.

  6. david esmay

    June 9, 2013 at 6:59 pm

    Low traffic D-boo-boo? The number of comments has nothing to do with the number of people who read NC Policy Watch. Are you comparing NCPW to the no traffic righty sites you cruise for talking points? Go back to your Pope funded propaganda machine and get an ideological massage.

    And to Laroach, bazinga!

  7. Doug

    June 11, 2013 at 8:37 am

    yeah esmay, keep thinking that. Just like there are very few people who agree with the radical progressive policies hysterically promoted here, there is little support for this web site. If there were really many people reading this there would be a lot more people replying to my posts. So far we have you, jlp, some faux “reverends” and just a couple more who seem to actually read the site. That is pretty low traffic for a blog that allows comments. Just face it…..there is no real support for progressive “values”…..just look at the morons they have to import for billy’s “Moron Mondays”.