U.S. Attorney announces new charges in Land Bank plot

A former city employee already charged in a fraud scheme involving the Indy Land Bank faces a new indictment handed down Thursday by the U.S. Attorney’s office.

The latest indictment charges Reginald T. Walton with wire fraud for his alleged role in a scheme involving the land bank and a city mowing contract with Mark Harsley. Harsley, who previously had not been charged in the land bank scheme, also is charged with wire fraud.

The two men began their alleged scheme in February, when Walton allegedly began soliciting financial kickbacks from Hartley in exchange for landing Hartley a city contract to mow lawns of properties owned by the land bank, according to the indictment.

At the time, Walton ran the land bank program as an assistant administrator of the Indianapolis Department of Metropolitan Development.

The indictment said Harsley began submitting invoices in the summer and collecting payment as operator of Core Contracting LLC. The one-year contract capped the amount he could receive at about $40,000. Walton, however, received none of the money, according to the indictment.

The land bank acquires abandoned and tax-delinquent properties throughout the city to sell to both not-for-profit and for-profit developers.

“This is really part of the land bank deal because Reggie Walton ran the land bank,” said Bradley A. Blackington, lead prosecutor in the case, at the Thursday announcement. “It’s directly the same investigation into the land bank.”

The new charges against the two follow the May indictment of Walton and four others, including John Hawkins, who was the DMD’s senior project manager.

Hawkins has agreed to plead guilty, though a judge has yet to grant his request. A trial has been set for Feb. 24, but it could be continued because one of the defendants has filed for a continuance.

The other defendants are David Johnson, executive director of the Indiana Minority AIDS Coalition; Randall Sargent, owner and president of New Day Residential Development; and Aaron Reed, a friend of Walton.

Before Thursday’s charges, the indictment against the five contained 11 counts of wire fraud, in addition to bribery and conspiracy related to the alleged real estate scam that fleeced its victims.

The case was developed by a public corruption task force that includes representatives from the FBI, Indiana State Police and U.S. Attorney's Office. The probe, which included the use of a wire tap and an undercover FBI agent, led to a May raid of the City-County Building offices of the Indy Land Bank.