Norman company accused of fraud reaches agreement

Norman company accused of fraud
reaches agreement with prosecutors

Norman-based McSha property company accused of defrauding a federal tax credit program designed to encourage development of low-income housing projects has reached a plea deal with prosecutors.

McSha Properties Inc. is charged with wire fraud and money laundering after former company executives allegedly set up two shell companies to receive and distribute the proceeds in a scheme that operated between March 2003 and August 2006, authorities said.

The charges are not expected to affect any of the more than 50 properties McSha manages, company president Steve Jones said.

McSha officials cooperated with federal authorities once they learned of the fraud allegations, Jones said. An internal review confirmed investigators' findings, he said, and the people implicated in the scheme have resigned.

Papers filed in federal court in Oklahoma City last week describe three McSha officials by job title, but doesn’t identify them by name.

McSha’s chairman, chief financial officer and vice president of construction allegedly created a limited partnership to build low-income housing in Choctaw, according to prosecutors. They also formed a phony construction company in Texas that purportedly worked on the project.

The scheme netted almost $6 million, court papers state.

McSha is expected to plead guilty to the fraud charges next week, but attorney Robert McCampbell declined to discuss details of the agreement.

The wire fraud and money laundering charges are each punishable by five years of probation and a $250,000 fine.