Former county judge accused of forgery, money laundering

Former county judge accused of forgery, money laundering
Matthew Oliver Orf (Source: Izard Co. Sheriff's Office via Vinelink)
Matthew Oliver Orf (Source: Izard Co. Sheriff's Office via Vinelink)
Paul Stacy Shuttleworth (Source: Izard Co. Sheriff's Office via Vinelink)
Paul Stacy Shuttleworth (Source: Izard Co. Sheriff's Office via Vinelink)

IZARD COUNTY, AR (KAIT) - Former Izard County Judge David Sherrell faces felony charges of forgery, theft of property, and money laundering.

According to a bench warrant signed Wednesday by a circuit court judge, Sherrell is accused of using his position to acquire property—including tools, a 20-ton trailer, a road grader, and a bulldozer—for his personal use.

In the probable cause affidavit, an Arkansas State Police investigator said Sherrell went to Coal Creek Truck and Equipment Sales to purchase two dump trucks for the county. While there, he also reportedly selected a used 20-ton trailer that he was not authorized to purchase.

The investigator said Sherrell asked the salesperson to increase the price of the dump trucks to include the price of the trailer, allowing him to purchase it for "zero dollars."

On June 24, 2015, Sherrell signed two invoices for the purchase of the trucks. Two days later, Sherrell took "personal possession of the trailer," which was valued at $7,000.

The following month, the quorum court approved financing for the two trucks at a cost of $83,000. Sherrell, the court documents state, never told the quorum court the trailer's price was included in the purchase.

"In summary, Izard County unwittingly pays for the trailer and Sherrell takes unauthorized personal possession of the trailer," the document stated.

A few months later, in November 2015, Sherrell reportedly arranged for his son-in-law, Matt Orf, to sell the trailer to Izard County for $9,250.

After Sherrell approved a claim for allowance, the affidavit said the Izard County Treasurer delivered a check in the amount of $9,250 to Sherrell.

The investigator said Orf and Sherrell "promptly endorsed" the check. Bank records showed that $3,000 was deposited into the Sherrell Farm Account, $3,000 was deposited into the David or Fern Sherrell Account, and $3,250 is cashed out.

"In summary, Izard County buys the trailer a second time, but this second time the county actually receives the trailer," the document stated.

It was not until after Sherrell left office that the scheme was discovered.

Sherrell is also accused of purchasing a John Deere road grader for use on his farm.

In June of 2015 he went to Stribling Equipment and selected a John Deere 670G road grader and a John Deere 670B road grader. The order form placed the cost at $143,000 for the 670G grader and $20,000 for the $670 B grader, the affidavit said.

However, the ASP investigator said he found a fraudulent invoice selling a single John Deere 670G grader to the county for $163,000.

"Stribling personnel identify the fraudulent invoice as a fake," the investigator stated in the court documents.

According to the affidavit, on July 2, 2015, Sherrell presented the fraudulent bill of sale to Paul Shuttleworth, who was a Stribling salesperson. Shuttleworth reportedly acknowledged the bill of sale was fraudulent, but signed it "for fear of losing the sale."

Sherrell then presented the purchase to the quorum court, which approved the financing of the 670G road grader for $163,000. He did not disclose that the cost included $20,000 for the 670B grader, the document said.

"Izard County unwittingly pays for the 670B road grader and Sherrell takes unauthorized personal possession of the 670B road grader," the affidavit said.

In the spring of 2016, the investigator said Izard County Road Department employees replaced the road grader's blade with a county blade at the Sherrell farm, on county time.

In December of 2016, after Sherrell lost his bid for re-election, the 670B road grader appeared at the county road department. The investigator stated "most employees of Izard County had never seen the 670B grader before."

Before he left office at the end of 2016, the investigator said Sherrell made yet another purchase for a Case 1150K bulldozer from Scott Equipment Company.

Sherrell himself picked up the dozer on Sept. 2 and signed an Outbound Delivery Receipt identifying Izard County as the customer, the affidavit said.

The former county judge drove the dozer to his personal farm and unloaded it for use, the investigator said.

"The dozer is never tested by Izard County Road Department employees and is never taken to the Izard County Road Department for use during Sherrell's term in office," the affidavit stated.

On Sept. 12, Scott created a retail order form indicating David Sherrell purchased the dozer for $43,000. His signature reportedly appeared on the order form on the same date.

On Sept. 30, Scott created two parts invoices for the 1150K dozer on the Izard County account in the amounts of $432.65 and $524.84. The court documents said the county paid the invoices.

On Oct. 17, according to the affidavit, Scott sent an invoice to Sherrell requesting payment of $43,000 for the dozer.

That same day, "Scott documents a new sales figure to Izard County in the amount of $58,000 for the 1150K dozer," the affidavit said. The documents reportedly indicate a base cost of $38,000 and an additional cost of $15,000 for repairs.

On Nov. 8, Sherrell loses his bid for re-election.

According to the investigator's account, the Izard County Road Department's foreman picked up the 1050K dozer from Sherrell's farm in "very poor condition and in need of extensive repairs" to return it to Scott.

Later that month, Scott created another invoice for $60,000 saying the dozer had a new undercarriage and the air conditioning had been fixed.

On Dec. 5, Scott created two more repair invoices in the amount of $15,000 and $3,409.38. The next day, the quorum court approves the purchase of the dozer for $60,000.

Before the year ends, on Dec. 29, the county receives another invoice for repairs from Scott in the amount of $3,285.45. The county paid the bill on Jan. 11, 2017.

The dozer was delivered to the road department on Jan. 23.

"It has significant hydraulic issues and is not capable of use by the Izard County Road Department to date," the ASP investigator said. "It is never used by Izard County Road Department."

The state investigator also alleged that on March 30, 2015, Sherrell purchased $3,500 worth of tools and parts at an estate sale paid for by the county.

With the help of several county employees, Sherrell loaded up the tools in the back of the trailer and dropped several of the items off at his farm, the affidavit stated. The remaining tools were taken to the Izard County Road Department's shop.

On May 31, 2017, ASP investigators served a search and seizure warrant at the Sherrell Farm. They recovered "multiple items" purchased by Sherrell for Izard County in the $3,500 transaction.

"The value of Izard County property recovered at Sherrell's property is less than $2,500 but more than $1,000," the court document stated.

After reviewing the ASP investigator's affidavit, a circuit court judge found probable cause Wednesday to arrest Sherrell for:

  • Criminal use of property or laundering criminal proceeds
  • Second-degree forgery, two counts
  • Theft of property

The judge also found probable cause to arrest and charge Orf with criminal use of property or laundering criminal proceeds.

The judge also issued an arrest warrant for Shuttleworth for second-degree forgery.

Officers arrested Sherrell on Nov. 1. He is currently free on $10,000 bond.

Orf and Shuttleworth were picked up Nov. 2. They were released on their own recognizance, according to the judge's orders.

Copyright 2017 KAIT. All rights reserved.

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