Five people were indicted Tuesday for wire fraud, conspiracy to commit wire fraud, major fraud against the United States and smuggling goods into the United States following an investigation. Vincent Lee Ferguson, 65, of Knoxville; Matthew Lee Ferguson, 40, of Lenoir City; Kerry Joseph Ferguson, 35, of Houston, Texas; Matthew Harrison Martland, 32, of Knoxville; and Stephanie Lynn Kaemmerer, 44, of Knoxville; pleaded not guilty.
According to court records, the defendants were executives and management at Wellco Enterprises, Inc., and conspired to defraud the United States government and other purchasers through a scheme to fraudulently import military-style boots that were made in China into the United States and then deceptively market and sell those boots to the United States Armed Forces, government contractors, and the general public as “Made in the USA,” and as compliant with certain domestic content preference laws, including the Trade Agreements Act and the Berry Amendment.
If convicted, each defendant faces a term of 20 years in prison as to each wire fraud charge and up to 10 years in prison for the charge of major fraud against the United States. Additionally, they face fines of up to $250,000 and up to three years of supervised release for each count. The indictment also seeks forfeiture of approximately $8.1 million.
The investigation was conducted by U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), the Defense Criminal Investigative Service, Air Force Office of Special Investigation, General Services Administration Office of Inspector General and the Defense Contracts Audit Agency.