Scott David Grinstead, who was the chief executive officer of Adams Produce Co. in Birmingham, AL, when the company declared bankruptcy last April, has entered into a plea bargain with the U.S. Attorney's office admitting fraud, according to a press release issued by the U.S. Attorney's Office in the Northern District of Alabama
The press release said that Mr. Grinstead
, 45, will plead guilty to a four-count felony indictment including wire fraud, misprision of a felony, and failing to file a tax return in 2009 and 2010.
has agreed to pay $450,000 in restitution to the bankruptcy estate of Adams Produce
for the benefit of the company's employees.
According to the press release from the government, the misprision of a felony count against Mr. Grinstead
was charged "for knowing of the fraud Pfahl and others were engaged in and allowing it to continue and end slowly, so as to avoid raising red flags with the government, rather than stopping it immediately and reporting it to authorities."
was charged with wire fraud for wiring hundreds of thousands of dollars from an Adams Produce account to American Express
to pay for clothing, jewelry, personal travel, lawn care at his
residence, and items for a vacation house in Alabama, according to the press release issued by the U.S. government.
(Editor's note: This updated version of this story replaces the earlier version published on Friday, Feb. 1, which contained incorrect information regarding the allegations against Mr. Grinstead
due to a reporting error.)