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BrickStreet auditor admits to millions in fraud

A Logan County field auditor for BrickStreet Mutual Insurance has pleaded guilty to charges stemming from a multi-million dollar fraud he helped orchestrate against his employer.

Arville W. Sargent, 52, of Chapmanville, pleaded guilty Wednesday to honest services mail fraud and tax evasion, U.S. Attorney Booth Goodwin said.

Four other individuals have also entered guilty pleas in connection with the multi-million dollar scheme.

Sargent was indicted by a federal grand jury in February for orchestrating the fraud against Brickstreet, which involved altering workers' compensation premiums and pocketing cash bribes.

Prosecutors said that from January 2006 until at least February 2011, Sargent allowed certain coal mining industry policyholders to drastically underreport their payroll during annual field audits he conducted.

Those companies - Aracoma Contracting LLC, Christian Contracting, Newhall Contracting and T&W Services, LLC - provided labor on a contract basis to coal companies in Southern West Virginia.

Prosecutors said that in exchange for saving those companies millions of dollars in insurance premiums owed to BrickStreet, Sargent accepted hundreds of thousands of dollars in cash bribes and other gifts, including a Yamaha Rhino all-terrain vehicle.

Goodwin said Sargent and his accomplices bilked more than $4 million from Brickstreet over the course of the scheme.

Former Aracoma employee Jerome Eddie Russell, 50, of Williamson, and Frelin Workman, 58, of Belfrey, Ky., also pleaded guilty to honest services mail fraud and tax evasion this week in connection to the scheme.

Randy Workman, 36, also of Belfrey, pleaded guilty to tax evasion and aiding and abetting honest mail fraud for using a cash payroll system to evade payroll taxes.

T&W Services employee Arthur White Jr., 60, of Lenore, also pleaded guilty to tax evasion.

U.S. District Judge John T. Copenhaver will preside over Sargent's July 8 sentencing. Sargent faces up to 25 years in prison and a $500,000 fine. 

Russell, Frelin Workman and Randy Workman will be sentenced July 2. Each faces up to 25 years in prison and a $500,000 fine

White faces up to 10 years in prison and a $500,000 fine. Sentencing is scheduled for July 11.

Contact writer Jared Hunt at or 304-348-4836.


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