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After FBI raided Evans Landscaping, employees worried about hiring attorneys, going to jail

Posted at 8:49 AM, Nov 30, 2018
and last updated 2018-11-30 08:49:19-05

CINCINNATI - A former Evans Landscaping manager testified that employees were worried about “protecting themselves,” and hiring lawyers in the wake of an FBI raid on the company in 2015.

Mike Moeller, a former general manager at Evans Landscaping, testified in U.S. District Court on Thursday as one of the last government witnesses in its case against prominent business owner Doug Evans.

“We talked about attorneys and if we should be getting any,” testified Moeller, who quit Evans Landscaping a few months after the raid. FBI agents raided the Newtown business in July 2015, more than a year after launching a criminal investigation into Evans Landscaping.

RELATED: Key witness in minority fraud case against Doug Evans testifies that he 'let down my race'

Two years later, in June 2017, a grand jury indicted Doug Evans and his vice president of operations, Jim Bailey, on six charges related to wire fraud. They face up to 103 years in prison if convicted.

Prosecutors allege that Evans and an IT employee, Korey Jordan, created a new company, Ergon Site Construction, in 2008 to act as a front for Evans to win small business and minority contracts worth millions from the state and the city of Cincinnati.

Local authorities and federal agents raided the premises of Evans Landscaping's Newtown location on Round Bottom Road in July 2017.

Four former Evans employees, including Jordan, have signed plea agreements admitting their guilt. All of them have testified at the trial, which is in its third week.

Moeller was the last of those former employees to testify. He spent most of Thursday on the witness stand, and jurors seemed riveted by what he said.

Moeller pleaded guilty to one count of wire fraud and will avoid prison time “If I tell the truth,” on the witness stand, he testified.

Moeller wrote the bids, without ever consulting Ergon, that won Evans more than $10 million in contracts to demolish schools across the state.

Moeller testified that his administrative assistant came to him, worried that they were committing a federal crime.

“Mae came to me and said, ‘This Ergon thing is an offense' … she said it could be five years in prison or a $10,000 fine,” Moeller testified. “I said, ‘That’s not our problem, we’re just estimating (jobs) … it’s a problem for Doug.'”

Moeller testified that Evans Landscaping inflated equipment charges and Ergon work charges on bids. He also said that Doug Evans asked him to submit a false payment application to the state for a job that lacked any minority subcontractor work at all.

“I said I wouldn’t sign it,” Moeller testified.

Larry Zapolski, longtime accountant for Evans Landscaping, testified at Doug Evans' trial in front of U.S. District Judge Michael Barrett on Wednesday. 

Moeller also testified that he wouldn’t sign a separation agreement from Evans Landscaping. That’s because the agreement contained a clause that “there was nothing illegal or even improper about the company’s involvement with Ergon,” Moeller testified.

Moeller said that longtime Evans bookkeeper Larry Zapolski, who testified at the trial on Wednesday and Thursday, spoke to him about a month after the FBI raid and said, “You just need to protect yourself.”

Under cross-examination by Evans’ attorney, Ben Dusing, Moeller admitted that he tutored and mentored Ergon owner Korey Jordan when the business was first formed.

“I think the whole intent was for this guy to run his own business, in the beginning,” Moeller testified. “It went in the weeds later on … basically it was going down hill.”

Several Evans employees testified that Jordan was rarely on job sites, was difficult to get in touch with, and had a falling out with Doug Evans that eventually caused him to leave the business.

They also testified that Evans Landscaping employees interchangeably wore uniforms from Ergon, and drove trucks that had Ergon magnets used to hide the Evans logo.

Doug Evans, founder and president of Evans Landscaping Inc.

Perhaps the most crucial witness in the case took the witness stand late on Thursday: Tony Schweier, who is a shareholder at prominent Cincinnati accounting firm Clark Schaefer Hackett & Co.

Schweier, a longtime advisor to Doug Evans, testified that he warned him against starting Ergon.

“I told him that it was a bad idea,” Schweier testified. “He didn’t agree with me.”

He described Evans as an abrasive authoritarian who was so hands-on in his business that he still dispatched trucks and reviewed every single bid.

Evans grew his landscaping empire from a humble beginning hauling mulch in a pickup truck as a teenager. The company now employs 250, produces $35 million in annual sales, and has multiple divisions.

The idea to start Ergon as a minority company would allow Evans Landscaping to bid on government contracts and keep the business going during the recession, Schweier testified.

When Schweier asked about the company’s unusual name, he testified that Evans “suggested that I needed to rearrange the letters of Ergon to spell a different word.”

Last week Jordan testified that Ergon was a jumbled spelling of the word ‘Negro.’

Ben Dusing, attorney for Doug Evans, delivers an opening statement to the jury on Tuesday, November 13, 2018. Illustration by Kevin Necessary | WCPO.

Over the years, Schweier said he tried to discourage Evans from continuing with Ergon.

“I continued to express concerns about the arrangement,” Schweier testified. “The risks he was taking would far outweigh any benefit he would get.”

Dusing, Evans' attorney, has insisted that the idea for Ergon actually came from Schweier. In court documents, he suggested that his client was simply following the advice of a trusted advisor.

This is something Schweier flatly denied on Thursday.

“Was Ergon your idea?” Assistant U.S. Attorney Tim Mangan asked.

“No, sir,” Schweier testified, in a firm voice.

Dusing will cross-examine Schweier on Friday.