CEO of Nexus Services Inc. and spouse have trials postponed until 2024
STAUNTON — With a federal trial and state trial both scheduled at the same time in December, it was inevitable that one of the trials involving defendants from Nexus Services Inc. would have to be postponed.
But after court hearings held Monday and Tuesday in the United States District Court in Harrisonburg and Augusta County Circuit Court, both criminal trials involving Nexus CEO Mike Donovan and his spouse, Richard Moore, a former owner and executive at Nexus, have been continued into next year.
On Monday in federal court, Moore, charged in 2021 with 10 counts of employment tax fraud, was arraigned on a superseding indictment that included two new felony charges of aiding and assisting in the preparation of a false tax return. In all, the 12 charges carry a maximum of 56 years in prison. Moore pleaded not guilty to the additional charges.
Concerning the additional charges, federal prosecutors allege Moore filed a joint tax return with Donovan in 2020 in which they claimed to have paid $291,144 in federal taxes, which the government said is false. In 2021, Moore is alleged to have been involved in a second tax return that stated the couple paid $88,846, which the government alleges didn't happen. Donovan is not charged in the federal case.
The initial 10 federal charges accuse Moore of not paying the IRS more than $1.5 million during a six-year period. According to the Justice Department, he allegedly directed the company’s day-to-day management, was responsible for paying employment taxes to the IRS and "determining which of Nexus's bills to pay and when to pay them."
For various tax periods between the first quarter of 2015 and fourth quarter of 2020, the Justice Department said Moore allegedly did not pay the IRS payroll taxes that were withheld from the paychecks of employees at Nexus.
However, during a pre-trial conference following his arraignment, Moore's two-week jury trial, scheduled to begin Dec. 4, was postponed Monday in federal court because of a potential conflict of interest between Moore's attorney, Atlanta-based Joshua Lowther, who once represented Zachary Cruz, the alleged victim in the Augusta County embezzlement case. Because evidence from the two trials could overlap, Lowther then withdrew from the case.
A new date for the federal trial has not been set.
So far, Moore has had six attorneys represent him in the federal case, according to court files. Amina Matheny-Willard, recently brought onboard by Moore, filed paperwork Monday suggesting a former Nexus employee who embezzled "significant funds" was to blame. That is most likely a different tact than Lowther was going to take in the case. Before he stepped down from representing Moore, Lowther told the court, "Mr. Moore's not satisfied with the way I attend to try this case."
In Augusta County in October 2022, Moore and Donovan were indicted on single felony charges of obtaining money by false pretenses and conspiracy to commit a felony, as well as two charges of financial exploitation of a vulnerable adult. Donovan and Moore are accused of stealing $426,000 from Cruz — the brother of the convicted Florida school shooter Nikolas Cruz — after befriending him following the 2018 mass shooting and moving him to Virginia. Nexus executive Timothy Shipe, whose attorney withdrew from the case Tuesday, is facing single charges of financial exploitation and obtaining money by false pretenses in the case, court records show.
In Augusta County Circuit Court on Tuesday, Judge Shannon Sherrill granted a joint motion to continue the state case until July 24, continuing a pattern of delayed trials concerning Moore. In 2019, Moore was involved in a Staunton incident that eventually got him charged with perjury in Augusta County the following year. However, the case dragged on and was finally taken under advisement until 2024 after Moore pleaded no contest in September.
"This case won't go for four years," Sherrill warned. "I want everyone to know that up front."
Moore is no longer an owner of Nexus after Donovan acquired his 39% stake in February 2022, giving him 90% ownership and Nexus executive Evan Ajin the other 10%, a court filing shows. That same year, Donovan told The News Leader that Moore was no longer a vice president at the company.
Although the trials have been postposed, other issues remain. In July, the former Nexus campus in Verona was sold off at a public auction for $3.4 million following a foreclosure.
In a 2021 federal lawsuit that is still pending, the Consumer Financial Protection Bureau — along with the states of Virginia, New York and Massachusetts — is seeking more than $800 million from Moore, Donovan and Ajin, Nexus Services Inc. and its subsidiary, Libre By Nexus. In May, a federal judge found the trio in contempt for noncompliance in the lawsuit and ordered that default judgements be entered.
The company, through Libre by Nexus, helps people secure their release from the custody of U.S. Immigration and Customs Enforcement (ICE). The federal lawsuit claims the trio's "illegal conduct" has impacted tens of thousands of consumers, and alleged Nexus used deceptive, abusive, and unfair practices to induce clients to sign contracts and pay thousands of dollars.
Brad Zinn is the cops, courts and breaking news reporter at The News Leader. Have a news tip? Or something that needs investigating? You can email reporter Brad Zinn (he/him) at bzinn@newsleader.com. You can also follow him on X (formerly Twitter).
This article originally appeared on Staunton News Leader: Nexus Services Inc. CEO, spouse, have trials postponed until 2024
