The former mayor of Kerkhoven, Minn., whose short tenure was marked by quarrels and controversy, has been sentenced to two years' probation on a federal bankruptcy fraud charge.
James Rothers pleaded guilty to a fraud scheme concocted with his lawyer to hide more than $1 million in assets from creditors of his bankrupt grain bin construction company.
His lawyer, Gregory Ronald Anderson of Willmar, who was convicted in a related case, was sentenced to 18 months in prison and disbarred.
Rothers was sentenced in late December in U.S. District Court in Minneapolis. Reached by phone Wednesday, he declined to comment on his case.
Rothers received a lenient sentence because he cooperated to convict his attorney, federal prosecutors said in a court filing.
"The government's primary concern regarding this matter was the apparent extent to which a lawyer helped his client defraud the system," prosecutors wrote. "[Rothers] agreed to plead guilty, proactively cooperate, and hold his case in abeyance as the government addressed his lawyer's misconduct. As that attorney fought tooth and nail, Rothers testified extensively before the grand jury after pleading guilty."
Rothers and Anderson executed a wide-ranging fraud designed to hide millions of dollars from creditors of Rothers' bankrupt construction company, which built grain silos throughout the Midwest.
According to court documents, Rothers moved assets to sham companies; set up a corporation in the Caribbean island of Nevis; bought more than $1 million worth of precious metals; and fraudulently cashed hundreds of thousands of dollars' worth of checks written to other people.
Rothers was elected mayor of the west-central city of 800 residents in 2016 and resigned five months later at a contentious City Council meeting. Council members were angry that Rothers hadn't followed through on a promise to tear down an odd-looking, 54-foot tower he built on U.S. Hwy. 12 to promote his construction company.
Some residents like the tower, but many consider it an eyesore and want it gone.
"We had a nice windstorm this summer, but it's still standing," City Clerk Kim Harkema said Wednesday.
Despite his controversial actions, many in Kerkhoven retained a fondness for Rothers. Townspeople said Rothers and his father, Jon, saved Kerkhoven about $40,000 a few years ago when they donated labor and materials to rebuild the city's swimming pool.
Rothers also rebuilt a barn that burned down on a local dairy farm and never sent a bill, said Rich Radtke, who owns Prairies Edge Organic Dairy with his wife, Carol. The barn, which burned in 2013, cost more than $40,000 to rebuild, Radtke said.
Besides standard probation terms, Rothers is required to provide all requested financial information to his probation officer and is prohibited from opening any new lines of credit without permission.
