Former Palmetto Railways CEO Pleads Guilty to Conspiracy to Commit Honest Services Fraud

For Immediate Release

CHARLESTON, S.C. -Jeffrey McWhorter, 63, of Awendaw, has pleaded guilty to conspiracy to commit honest services fraud, which was committed during his time as President and CEO of Palmetto Railways.

Evidence obtained in the investigation revealed that McWhorter introduced a known co- conspirator, referred to as T.B., to a company headquartered in Texas. T.B. hoped that McWhorter's introduction would facilitate him being awarded a contract for work in the Charleston area by the Texas company.

Prior to the contract being awarded to the Texas Company, McWhorter, TB, and an employee of the Texas company (Employee 1), had meetings and discussions about T.B. paying McWhorter and Employee 1 if his company was awarded the contract.

McWhorter and his known coconspirators further agreed that T.B. would send money to a to Employee 1, and evidence revealed that TB did in fact wire the money to a bank account was in Employee 1's wife's business name. The agreement was that Employee 1 would then pay McWhorter his portion in cash.

Throughout the course of the conspiracy, the evidence revealed that the payment McWhorter and Employee 1 were receiving caused, or could have caused, economic harm to the Texas company.

T.B. ultimately wired at least $400,000 to Employee 1 in Texas and McWhorter received at least $90,000 of this in cash.

McWhorter faces a maximum penalty of five in federal prison. He also faces a fine of up to $250,000, restitution, and three years of supervision to follow the term of imprisonment. United States District Judge David C. Norton accepted the guilty plea and will sentence McWhorter after receiving and reviewing a sentencing report prepared by the U.S. Probation Office.

This case was investigated by the FBI Columbia Field Office. Assistant U.S. Attorney Amy Bower is prosecuting the case.

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Topic

Financial Fraud

Component

USAO - South Carolina