A federal grand jury sitting in U.S. Virgin Islands returned a 35-count superseding indictment against James Auffenberg in connection with a fraudulent tax evasion scheme involving the abuse of a Virgin Islands economic development program.
Peter Fagan of De Leon, Texas, James Ferguson III of Amarillo, Texas, and J. David Jackson of St. Croix, U.S. Virgin Islands were also included in the indictment.
The indictment superseded an indictment originally returned by a grand jury in East St. Louis on March 23. The case was transferred to the District of the Virgin Islands on July 5.
In addition to the charges in the original indictment, the superseding indictment included criminal offenses under the Virgin Islands Code brought in the name of "The People of the Virgin Islands."
The U.S. Attorney for the District of the Virgin Islands prosecutes criminal offenses under the Virgin Islands Code.
The original 21-count indictment alleges that Auffenberg, a local car dealer, joined a partnership that was created and promoted by Ferguson and Fagan in the U.S. Virgin Islands that fraudulently used a Virgin Islands economic development program meant to promote the local economy and jobs.
The indictment also seeks the forfeiture of about $16.2 million in cash.
The case is being handled by Assistant U.S. Attorneys Michael J. Quinley and Bruce E. Reppert of the Southern District of Illinois and Trial Attorney Gregory E. Tortella of the Department of Justice Tax Division who were sworn in as Special Assistant U.S. Attorneys for the District of the Virgin Islands on Oct. 12.
The case was investigated by the Internal Revenue Service Criminal Investigations in Fairview Heights.