GAINESVILLE -- A Forsyth County woman has pleaded guilty in federal court to theft by conversion, admitting to stealing hundreds of thousands of dollars in federal grant money over the course of nearly a decade.
Jessica Kelley Regas, 62, entered a plea agreement last week in the U.S. District Court in Gainesville.
According to the plea agreement, Regas first applied for grant funding in 2004 from the U.S. Department of Health and Human Services’ Substance Abuse and Mental Health Services Administration, or SAMHSA, for the creation of the Drug Free Forsyth Coalition.
Det. Edmond Van Bever with the Forsyth County Sheriff’s Office said the office was first alerted that Regas may have misused the grant funds in fall of 2013, when Forsyth Commissioner Cindy J. Mills began looking into the possibility of beginning a Drug Free Coalition for the county.
In her research, Mills discovered that Forsyth County was not eligible for the grant because it had already been awarded to the Georgia Martial Arts Foundation, under the direction of Regas and her husband.
Through the Georgia Martial Arts Foundation, Regas and her husband were to oversee the Drug Free Forsyth Coalition, meeting specific regulations required by the SAMHSA grant.
Regas, according to the plea document, was the recipient of the grant funding from 2004 through 2013, receiving around $100,000 per year from 2004 to 2008 and around $125,000 a year from 2009 to 2013.
In 2011 the Georgia Martial Arts Foundation ceased to exist, but Regas continued to receive the grant funding of $125,000 a year.
She and her family “used the bulk of the proceeds of this offense for their own personal benefit,” states the plea agreement.
Regas’ attorney, Dennis Scheib, who said he is also a family friend of more than 20 years, said Regas takes full responsibility for her actions in the matter.
“She’s not making any excuses for what happened,” Scheib said. “She started out, her and her husband, started out doing something very viable in the community as far as the drug coalition.”
Scheib said initially, the couple had a partnership with the juvenile justice system where troubled youth would come to a program they oversaw at their martial arts studio.
“They had been doing that for years and they dealt with, probably, over the years, several thousand kids,” he said. “And it was going right and … somehow, someway it just became a scenario where they did less and less.”
Scheib believes Regas’ misuse of the funds may have begun as the result of a longtime illness of her husband that began in 2011.
“He was in the hospital for seven months and almost died,” Scheib said, noting that the whole grant scenario was “a good situation turned bad as far as what they did and didn’t do.”
While she hasn’t been sentenced, Regas could face up to 10 years in prison and a fine of $250,000, plus repayment of the total grant funding that was misappropriated.