Tobacco commission officials saddened by Forbes’ fraud

The Virginia Tobacco Indemnification and Community Revitalization Commission thought John W. Forbes II was bringing educational opportunity to people who needed it in the state’s tobacco belt, the former head of the commission said yesterday.

Forbes represented a nonprofit, charitable organization that was promising to take a $5 million grant from the national tobacco settlement and turn it into $15 million for scholarships or other educational aid to people in communities that were losing one of their economic mainstays.

“It was an opportunity we just couldn’t turn down,” said former state Sen. Charles R. Hawkins, R-Pittsylvania, chairman emeritus of the commission.

It’s a different story now, with Forbes pleading guilty in a $4 million federal fraud case.

“It’s just a difficult time for all of us,” said Hawkins, who helped create the commission with legislation adopted by the General Assembly in 1999.

At the time the grant was made in 2001, Forbes was secretary of finance for then-Gov. Jim Gilmore and his representative on the commission.

But information about how Forbes’ organization, the Literary Foundation of Virginia, was spending the money wasn’t always easy to get, said Frank S. Ferguson, the commission’s general counsel and a former assistant attorney general.

“There were certainly some concerns about how the money was being used within a couple of years after the grant was awarded,” Ferguson said yesterday.

Ferguson and Hawkins said they pressed Forbes for information and he satisfied them with documentation that the money was being used for its intended purpose. The foundation spent more than $900,000 of the grant to promote adult literacy in the region, according to court documents.

“We did everything we could do. . . . No one ever raised a red flag,” Hawkins said.

The registered agent for the foundation was Clark H. Lewis, an attorney for Troutman Sanders, a law firm that the commission chose as its fiduciary agent. Lewis said yesterday that he no longer serves as registered agent for the foundation and that his sole responsibility had been to service papers to the organization.

Ferguson said he and some members of the commission learned about the allegations against Forbes when the FBI contacted them for its investigation in the spring.

“This is very disappointing,” Hawkins said.

source: timesdispatch.com

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