Ongoing FBI probe moves to Muncie Sanitary District
Keith Roysdon
MUNCIE. Ind. — When Muncie Building Commissioner Craig Nichols was charged with 33 white-collar crimes in February, the Department of Justice said the FBI probe into allegations of wrongdoing in city government was "ongoing."
On Thursday, the city saw an indication of one possible focus of that ongoing investigation, as FBI agents, assisted by Indiana State Police officers, raided Muncie Sanitary District offices in Muncie.
The FBI's Indianapolis office would only confirm that "investigative activity" was underway locally Thursday, but it's likely that the latest high-profile appearance of federal agents indicated a continuation of the investigation that began in early 2016.
That investigation, which included money paid to Nichols as a private contractor for demolition-related work for the city and Muncie Sanitary District as well as other monies spent, was detailed in the lengthy indictment against the building commissioner. Nichols was charged with wire fraud, money laundering and theft.
Thursday's raid on Muncie Sanitary District offices appeared to indicate a greater breadth to the investigation, as FBI agents focused on the district's engineering offices along Kilgore Avenue.
While an FBI agent and state police officer waited outside one of several buildings on the Muncie Sanitary District property, in an area back from Kilgore Avenue that is posted as "private property," investigators were inside.
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Chris Bavender, public affairs specialist for the FBI's Indianapolis office, said Thursday afternoon she could not confirm that search warrants were executed.
"I can only confirm there is investigative activity in the area, but I can't disclose the nature of that activity," Bavender told The Star Press.
Indiana State Police officers were on hand in "a supporting role only," state police public information officer John Bowling told The Star Press. "I believe it's an FBI investigation."
Mayor Dennis Tyler said just before noon Thursday that the city is "fully" cooperating with the FBI.
"The city of Muncie has fully cooperated and intends to continue to fully cooperate with the FBI investigation," Tyler said in a statement in response to questions from The Star Press. "The city of Muncie became aware of law enforcement activity being conducted at one of the Muncie Sanitary District's locations today through media reports.
"The city has not been made aware of the reasons for law enforcement activity at this time. Media requests for comments should be directed to the Muncie Sanitary District," Tyler added.
At the sanitary district property Thursday morning. The Star Press spoke with an unnamed FBI representative and an ISP investigator at the scene before being told to leave the property.
Muncie Sanitary district attorney Tom Malapit told The Star Press to leave the property, which is across Kilgore Avenue from the former BorgWarner Automotive plant. Malapit said the area was "private property" and tried to block cell phone pictures.
Malapit said he would answer questions after the FBI and state police presence at the property was over. The Star Press sent several questions to Malapit and Nikki Grigsby, administrator of the district. Neither Malapit nor Grigsby responded to the questions.
In a subsequent telephone interview around noon, Malapit said only that, contrary to rumors, no sanitary district employees had been arrested Thursday "that I know of."
Malapit's comments were in response to a voice mail message The Star Press left for a Muncie Sanitary District official, who had been the subject of rumors about arrests.
Another Muncie Sanitary District official, Doug Marshall, assistant superintendent of sewer maintenance and engineering, is also a member of Muncie City Council.
"I don't have no comment," Marshall said when contacted by The Star Press later Thursday.
Sanitary district officials have previously denied that the district, created in the 1960s to build and maintain Muncie's storm and sanitary sewers, was part of the FBI investigation.
On May 14, 2016, the district's Twitter account tweeted: "The Muncie Sanitary District is not part of the FBI investigation recently reported on." That tweet was subsequently deleted.
Sources indicated Thursday that investigators served search warrants in at least two buildings at the Sanitary District site, one building that has information technology equipment and the other a building with district trucks and other equipment.
Although there's no official confirmation from the FBI or state police, eyewitnesses reported at least one other location in Delaware County where investigators were present Thursday morning.
Contact Keith Roysdon at 765-213-5828 and follow him on Facebook and Twitter.