The Williamsburg Housing Authority’s suspended executive director was arrested Monday morning for allegedly using forged checks to misappropriate about $10,000 in funds since at least January 2017, but Williamsburg police are still investigating and think that amount could increase as more records are examined.
Williamsburg Police Lt. Bobby Freeman arrested James R. Lovitt Jr., 52, of Williamsburg, at his residence at 9:50 a.m., and charged him with second-degree forgery and abuse of public trust over $10,000 but less than $100,000.
“What we know right now that we see immediately is that he has forged numerous checks in the names of individuals, who did not receive that money. Nor did they sign or cash any checks. Nor have they ever done any work for the housing authority,” Williamsburg Police Chief Wayne Bird said Tuesday morning.
“We also uncovered some manufactured receipts claiming that certain individuals did work for the housing authority when in fact they did not. We felt like we needed to go ahead and charge him with what we knew as of right now. We will present our other findings to probably the October grand jury. In the mean time we will be in conversation with the FBI and the housing authority Office of Inspector General (OIG) office, and see where it goes from there.”
According to Lovitt’s arrest warrant, between 2017 and 2019 he allegedly forged numerous checks, which he cashed at a local bank.
“The defendant manufactured phony receipts showing payment to individuals for work that was never done all while in the appointed position of Executive Director of the Williamsburg Housing Authority, and the defendant gained financially by taking monies from public funds,” Freeman wrote in the arrest warrant.
In early August, Williamsburg police received a tip about the possibility of misappropriated federal funds from the housing authority and began an investigation.
A few days later, Williamsburg police developed enough information to obtain a search warrant for housing authority records, and have sent out subpoenas for several financial records, which they are still sorting through, Bird said.
“The records we have looked at so far is where the charges stem from that we recently placed on him,” Bird noted.
Bird said that it is too early to tell whether federal charges might be filed in connection with the case. Federal authorities generally prefer to see at least $10,000 in aggravating circumstances, and so far the investigation has revealed about that much taken.
“It is a matter of us finishing up looking at the financial records. As I said before, there are a lot of them. We are working with the OIG office out of Memphis. They have agreed to assist us with a forensic audit,” Bird said.
The housing authority receives an annual audit, but auditors primarily spot check various records and are often looking to make sure receipts coincide with expenditures, and so forth.
“We are hoping to get assistance with a forensic audit. I think a forensic audit is what it is going to take for us to uncover a lot of this,” Bird said. “The forensic audit will go a lot deeper and in more detail than a regular audit.”
So far, investigators think Lovitt is the only one involved in the case.
Williamsburg police have only examined records going back to January 2017, but may expand their investigation beyond that time frame.
“I think if we get the forensic audit and get assistance with that then I think they will go back the entire time (he was executive director). At least I hope so. That is going to show us when it started. I don’t want to speculate when it started, but I know it at least went back two years.”
Bird said that he anticipates there will be additional charges after the case is presented to the grand jury.
“Right now we are right at $10,000 just on the obvious stuff that we have looked at,” Bird said. “There is a lot more that is coming.”
So far Lovitt has not made any statements to authorities and police haven’t tried to get a statement from Lovitt.
Lovitt was booked into the Whitley County Detention Center at 10:44 a.m. Monday, according to the detention center’s website.
He was arraigned late Tuesday morning in Whitley District Court via video from the Whitley County Detention Center, which is a standard procedure.
Judge Cathy Prewitt entered a not guilty plea for Lovitt, and scheduled a Sept. 9 preliminary hearing in his case. She left his $25,000 cash bond unchanged.
When asked whether he was going to hire an attorney or wanted one to be appointed for him, Lovitt replied that he has a lawyer but he was “drawing a blank” in regards to the lawyer’s name.
The Williamsburg Housing Authority Board of Directors voted during a special meeting on Aug. 23 to suspend Lovitt with pay pending the outcome of a conclusive investigation by the Williamsburg Police Department, which is being assisted by the FBI.
The board also voted that day to remove Lovitt’s name from all housing authority financial accounts “effective immediately” pending the outcome of the investigation.
Lovitt has been executive director of the housing authority since 2013, and worked for the agency for 14 years prior to that.