Local News

Judge To Rule On Hatley's Motion To Withdraw Guilty Plea

Posted January 31, 2006
Updated November 18, 2006

— After three days of testimony, a ruling is expected Wednesday on whether Wake County Public School System's former transportation director will get a trial -- even though he pleaded guilty last October to charges in connection with a fraud case where $3.8 million of public money was siphoned from the school system.

In early January, Vern Hatley's attorney filed a motion to withdraw his client's plea, citing that his client did not know that money and gifts he received were the result of criminal activity.

Last week, Hatley testified that he only accepted the plea deal to spare his family and the school system further embarrassment, and because he felt responsible, since the fraud occurred while he was director.

But testimony of other co-defendants who pleaded guilty to fraud charges -- such as former Barnes Motor & Parts managers Connie Capps and Bobby Browder -- suggests that Hatley was aware of the scheme between his department and the Wilson-based automotive parts supplier.

Capps testified Tuesday that an inappropriate relationship between the transportation department and Barnes began as early as 2001 when Hatley wanted his office redecorated.

"Mr. Hatley had asked if we could bring any kind of books, catalogs -- for office furniture -- because he wanted to remodel the front offices at Wake County," Capps said during her testimony Tuesday.

By 2003, Capps testified, the transportation department was running a credit balance with Barnes that was tens of thousands of dollars -- all on a handwritten ledger from which Capps said former department budget analyst Carol Finch and others in the department could draw.

She also testified that Hatley had also approved Barnes' Raleigh office, where Capps worked, to be redecorated.

Browder testified that he would buy gift cards for transportation department employees, subtract from the credit, and charge a 30 percent markup for Barnes to make a profit.

"Barnes had told me to do whatever it took to make the people at Wake County happy," Capps said.

While Browder said he is not sure if Hatley knew about the extent of personal purchases, Capps said she thinks Hatley was fully aware.

"Ms. Finch would usually tell me what to get, or a couple of times she had gave Bobby a list that had Angela (Sanders') and Mr. Hatley's name on it," she said.

Capps' testimony also focused on her relationship with Finch, with whom she shopped and took trips -- including one to Mexico. She said Finch bought vehicles, jet skis, trips and other gifts -- some of which were kept in Capps' name -- and that Hatley agreed to the payment plan that helped purchase those items.

Finch, who some co-defendants in the case say was someone with significant control in the scheme, was expected to testify Tuesday, but Wake County District Attorney Colon Willoughby said the hearing was taking too long.

The first to be arrested in the investigation, Finch was the last of six suspects who pleaded guilty to charges in December. One other suspect, Harold Estes, was also charged in connection with the case, but he has pleaded not guilty.

As far as Capps' statement about Barnes telling her to do whatever needed to make the school system happy, Stephen Smith, Barnes' attorney, said Capps misinterpreted the statements as a license to steal.

If Superior Court Judge Donald Stephens allows Hatley, who repaid the school system, to withdraw his guilty plea, the case would go to trial at a later date. If Stephens denies the request, Hatley's case could go directly into the sentencing phase.

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