INDIANAPOLIS (WISH) - The suspects at the center of Indianapolis' Land Bank scandal appeared in court Friday to face new federal corruption charges.
Five suspects now face 11 counts of wire fraud and bribery following a May 21 raid of Indianapolis Department of Metropolitan Development offices.
Federal prosecutors allege that former DMD employees Reggie Walton and John Hawkins personally profited from the sale of some abandoned properties in the city’s land bank program. Both were fired the following day.
Executive Director of the Indiana Minority AIDS coalition David Johnson, New Day Residential Development owner Randall Sargent and Walton associate Aaron Reed also face bribery charges in connection with the case.
An internal report obtained by I-Team 8 showed city leaders were warned about potential problems with the program last year. The report also identified more than 50 additional properties potentially involved in the scandal.
In October, a federal grand jury also returned three new wire fraud counts against Walton and Johnson, accusing them of skimming additional money while providing assistance to the Marion County Prosecutor’s Office, who was helping to provide restitution for victims of another, unrelated fraud scheme led by Shela Amos. Amos was convicted earlier this year of selling vacant homes to at least a dozen people without possessing the legal titles to the properties.
Amos is now serving a 34-year prison sentence.
Walton and Johnson pleaded not guilty to the new charges in federal court Friday. Both were released on bail.
The case is scheduled for trial in late February.
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