09/14/11 — Five sentenced for illegal lottery

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Five sentenced for illegal lottery

By Steve Herring
Published in News on September 14, 2011 1:46 PM

MOUNT OLIVE -- A Duplin County couple who pleaded guilty in February to involvement in an illegal "numbers" lottery operation Monday received active sentences in federal district court in Greenville.

Three other defendants, who had also entered guilty pleas in the case, received probation that includes intermittent confinement.

Vonnie Lynn Beavers Sox, the alleged banker/manager for the operation, was sentenced to 37 months in prison on her plea on one count of tax conspiracy. The active sentence will be followed by two years of supervised release. She was ordered to surrender herself to the Bureau of Prisons no sooner than Dec. 1.

Her husband, Ronald Dean Sox, was taken into custody to begin a five-month sentence on his plea to conspiracy to commit money laundering. The active sentence will be followed by 150 days of home detention and two years of supervised release.

Mrs. Sox's brother, Roy Lee Beavers, and her brother-in-law, Jeffrey Brandon Sox, and Wayne Douglas Whaley each received three years of probation on their pleas to conspiracy to commit money laundering.

Beavers' probation includes 45 days of intermittent confinement, while Whaley and Jeffrey Brandon Sox will serve 30 days of intermittent confinement. Whaley was also fined $2,000.

Intermittent confinement typically means the person spends nights and/or weekends in custody. However, the judge can specify other time intervals.

The court also ordered Mrs. Sox to forfeit $526,463 in assets, including $486,463 in cash. The forfeiture also includes two cars and property on North Center Street in Mount Olive. Robin Zier, public information officer with the U.S. Attorney's Office, said the documents she had did not specify what the Mount Olive property was.

However, Duplin County Sheriff Blake Wallace said it was his understanding that the property was located next to the Murphy's restaurant and bar that Mrs. Sox had owned on North Center Street.

Mrs. Sox allegedly ran the illegal gambling operation, managed primarily out of her home and adjacent buildings, from May 2001 until March 2008. As banker/manager, Mrs. Sox "ultimately received the profits from the operation and determined how others would be paid," according to court documents.

All five live in the Rones Chapel community of Duplin County just east of Mount Olive and the sentencing brings to a close the case begun three years ago by the Duplin County Sheriff's Office. The investigation led to raids on March 11, 2008, at the home of Ronald and Vonnie Sox and at Murphy's restaurant and bar.

The restaurant has since moved to downtown Goldsboro. The raids were headed by the Duplin County Sheriff's Office. Federal authorities, Wayne deputies and Mount Olive police assisted.

"We received a tip early on and it took us quite some time to make inroads," Duplin County Sheriff Blake Wallace said today. "It took a lot of surveillance, and we made undercover purchases. We called in the IRS and Alcohol Law Enforcement to help. A lot of manhours were put into it."

Wallace said that the investigation started at the bottom and worked its way up to the leadership.

"I am glad that it is over," he said. "I admit that I am disappointed that they did not receive more active time. I appreciate the court allowing us to keep the property valued at over a half million dollars made through ill-gotten gains."

Half of that, about $250,000, will go to the Duplin County Sheriff's Office to help offset the cost of the investigation, he said.

"I hope this sends a message that if folks think they can get away with this that they are wrong," Wallace said.

According to court documents the operation spanned Wayne, Duplin and Pender counties and made use of runners, bag men, count houses and generated more than $1 million in income for Mrs. Sox.

The court documents further alleged that the four men conspired to conduct and attempted to conduct financial transactions affecting interstate commerce knowing that the transactions involved proceeds from an illegal activity.

The gambling operation was tied to authorized state lotteries that used the "Pick Three" type lottery results to determine the winners.

The court documents added that the gambling activity involved family members and friends related to placing bets, gathering the money, creating records and transferring money and records to Mrs. Sox and others.

It was alleged that "substantial taxable income" was generated by the gambling operation, and that the profits were deposited and used to "perpetuate" the operation.

The court documents alleged that Mrs. Sox's income for the tax years of 2003 to 2007 was $1,159,072 for which approximately $339,435 in taxes were due. It further alleged that Mrs. Sox failed to report the gambling profits as income on her federal income tax forms for 2003 and 2004.

According to the documents, Mr. and Mrs. Sox did not file tax returns for 2005, 2006 and 2007.

The court documents alleged that the men participated at various times in all or part of the gambling operation and that they would:

* Handle the bets placed with writers who would deliver the accounts, numbers and cash to a pick-up person or runner

* Act as runners who would deliver the wagers to a bag person and oversee a group of writers

* Function as a bag person who would deliver the bets and money to the count houses where others acted as a central accounting office.

People working in the count house would account for the betting transactions and keep records.

They were "directly controlled by the person acting as the manager or banker who is the financier or head of the gambling operation," according to the documents.

Profits were used to pay those involved, the winners and used for expenses associated with the gambling organization. In turn, the money was used to promote the organization as well as to purchase personal property and real estate.