FLATWOODS Newly unsealed court documents allege conspiracy, corruption and cover-up — and reveal scrutiny of Flatwoods city government by the Kentucky State Police, the Federal Bureau of Investigation and the Federal Emergency Management Agency.
Last Thursday, Special Judge John David Caudill unsealed documents in an unlawful termination lawsuit by former Flatwoods Police Chief Kraig Hankins against the city of Flatwoods.
The public documents allege inappropriate behavior by many city employees, including Mayor Bobby Crager and public works supervisor Brent Dean.
The case names as co-defendants the city of Flatwoods, Crager, Dean and his son, police officer Cody Dean, officer Chris Castle, officer Marty Hoffman, officer Scott Gillum and City Clerk Heather McKenzie.
According to the lawsuit, Flatwoods experienced “at least two incidents of major felony theft by city employees on the part of two administrative employees while Bobby Crager was mayor and former (now acting) police chief Tom Haynes was in charge of the city and the police department.”
An unnamed informant testified that since 2011, he’d observed the collection, transportation and sale of various scrap metals that belonged to the city of Flatwoods. He testified co-defendant Brent Dean ordered him to take expensive scrap to Huntington and less expensive metals to Mansbach Metals in Ashland. Following sales, Dean demanded all receipts and cash without any independent verification of the amounts he collected.
The same anonymous informant testified that in early 2012, he and another city employee were told to secretly go to the privately owned Caroline Cemetery to dig a grave with city equipment while on the city payroll. This informant said Brent Dean personally received $400 cash for the job. Dean has declined to comment about the lawsuit.
A city employee has raised allegations of verbal and physical harassment by Brent Dean, his direct supervisor, in a recent letter to Flatwoods’ mayor and city council members.
An eyewitness to at least one of the alleged incidents stepped forward to support his coworker’s allegations.
In documents obtained by The Independent, public works employee Bob Nolan alleged city maintenance supervisor Brent Dean has created a “hostile and threatening work environment” through repeated verbal harassment and a physical altercation.
According to Hankins’ newly public lawsuit, a confidential informant said Dean would order him to take used vehicle batteries to Ashland Battery Terminal and turn over any cash received to Dean, again without independent verification of the amount of money.
The informant said Dean allowed a private citizen to haul away scrap metal owned by Flatwoods “as a Christmas gift,” because the public works employees “had plenty of money in the scrap-metal kitty.”
The informant stated Dean used FEMA funds to purchase equipment for non-FEMA projects. He requested then-chief Hankins also attend a meeting with KSP and the Commonwealth’s Attorney. The informant told both agencies that Dean had threatened him, suspecting him as the source of revealing his unorthodox behaviors.
A different informant testified she witnessed city employees and Dean build a swimming pool for a “prominent city resident.” She believes Crager directed the project himself because “he is very tight with this family.”
The suit also alleges inappropriate behavior by city clerk and co-defendant Heather McKenzie, who filed harassment charges against Hankins earlier this year. Her charges were incorrectly reported as sexual harassment. The report alleges McKenzie participated in the creation of falsified reports and misappropriation of FEMA funds. For example, Flatwoods bought large amounts of blacktop with FEMA funds for non-FEMA projects.
Another informant testified that at Crager’s request, the city of Flatwoods spent $57,000 to remodel a home rented to McKenzie. Renovations were completed by city employees at the mayor’s direction. To date, the amount of rent and associated perks given to McKenzie have remained closed to public view. As clerk, McKenzie controls all city monies.
According to court documents, Dean and McKenzie approached Hankins to provide a camera “for FEMA reporting.” Hankins agreed at first, then reconsidered pending discussion with McKenzie about the matter.
The next morning, Hankins approached McKenzie, who stated FEMA authorized Flatwoods to build a file that covered past city FEMA expenditures. McKenzie said nothing was wrong and that Hankins “should not investigate further.”
Prior to this talk, relations between Hankins and McKenzie had been “cordial,” but afterward McKenzie cited this conversation as evidence of Hankins’ alleged harassment, which ultimately led to his termination.
Court documents also allege co-defendant Cody Dean, a police officer and Brent Dean’s son, failed to arrest his brother, Dustin Dean, or notify on-duty police of Dustin’s whereabouts despite knowledge of Dustin’s active felony arrest warrant for drug trafficking. A confidential informant also alleged Cody Dean sold city equipment online through Craig’s List.
Hankins claimed Crager became aware of Hankins’ investigation into Dean and others’ alleged misconduct, but “allowed a conspiracy involving the other defendants (to secure) Hankins’ termination, thwart his investigations and retaliate against him.”
Hankins contacted the KSP and the FBI about the co-defendants’ allegedly inappropriate behavior. Later, Crager confronted Hankins about the investigation into Brent and Cody Dean’s actions and demanded Hankins disclose details. When Hankins refused, Crager allegedly became “irate.”
Hankins asked KSP to brief Crager on the investigation. Afterward, Crager charged Hankins with various acts of misconduct, using “testimony of many of the same individuals Hankins had determined committed or were still committing illegal acts.”
The documents allege Crager contacted all but one member of the city council to lobby for votes against Hankins, backed up by what the former chief asserts were misleading comments from McKenzie.
Hankins’ lawsuit awaits a trial date in Greenup Circuit Court.
Despite attempts to reach Crager, he was unavailable to comment on the lawsuit.