Local News

Hatley To Serve 7 To 10 Years For Role In Fraud Scheme

Posted February 4, 2006
Updated November 18, 2006

— The former head of the Wake County Public School System's transportation department was sentenced Friday to 7 to 10 years in prison for his role in a fraud scheme that siphoned at least $3.8 million from the school system.

Vern Hatley tried to withdraw his guilty plea in a motion filed on Jan. 12, but Wake County Superior Court Judge Donald Stephens denied the request Wednesday after a four-day hearing to determine how much, if anything, Hatley might have known about the scheme and to decide whether he would get a trial.

Stephens likened Hatley's conduct and that of others implicated in the case to game-show contestants spending freely with no regard for the public's money.

"I just kept thinking, 'How in the world could this have happened?' There are so many people treating hundreds of thousands of dollars of taxpayer money as if they were contestants on the 'Wheel of Fortune,'" Stephens said. "I found the evidence particularly shocking."

Stephens said he had to struggle to try to balance the many good things Hatley had done in his entire life with the bad things he had done in the case.

"And on balance, I've decided the good things outweigh the bad things, and I have also decided, too, that these crimes are extremely serious," Stephens said.

"There's no question in my mind, and the evidence is clear that the defendant took advantage of a position of trust, or confidence, in order to commit this offense," Stephens went on to say.

Before being sentenced, Hatley apologized for his actions.

"To the Wake County citizens, to the Wake County schools, to the court, to my family and friends, I offer my deepest apology," he said. "I'm sorry. I accept responsibility for everything that I have done, both knowingly and unknowingly, and today, I stand here at the mercy of God and the court."

Hatley admitted to accepting nearly $23,000 worth of items, including $11,000 in gift cards from Wilson-based automotive parts supplier Barnes Motor & Parts. He said, however, that his former budget analyst, Carol Finch, controlled and benefited from the criminal scheme without his knowledge.

Hatley was taken to Craven Correctional Institution.

Finch, as well as two other former transportation department employees -- Pam Stewart and Angela Malloy-Sanders -- and two former Barnes managers -- Bobby Browder and Connie Capps -- also pleaded guilty last year.

They could serve sentences ranging from two months to 40 years in prison for their alleged involvement, pending their cooperation into the investigation.

A seventh suspect, Harold Estes, was also indicted, but pleaded not guilty to charges.

Barnes Motor & Parts was indicted last week in connection with the case, which is rare in state court, a local criminal defense attorney said. The automotive parts supplier's lawyer told WRAL last week that his client would take responsibility for the actions of its employees and would pay possible fines.

The Wake County school system recovered about $2 million from Barnes and suspects. Any amount that Barnes may pay would go to the school system.

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