Jacksonville City Council Members Katrina Brown and Reggie Brown have pleaded not guilty to 38 federal charges stemming from an alleged scheme to fraudulently draw down a federally backed loan.
After claiming indigence, both councilmembers are being represented by court appointed attorneys. Katrina Brown’s new attorney Darcy D. Galnor appeared with her for the first time Monday afternoon.
A status hearing for the two defendents was set for July 20.
A May indictment accuses Katrina Brown and Reggie Brown — no relation — of hatching the scheme as the councilwoman’s barbecue sauce business was unable to repay much of a $2.6 million loan the Small Business Administration approved after her business sold less sauce to Sam’s Club and Winn-Dixie stores than had been projected.
Prosecutors allege the pair created fake businesses to send the barbecue plant phony invoices in order to collect loan funds, but both Browns contend it was just a matter of business failure, not fraud.
In addition to the time behind bars, Katrina Brown was ordered to pay $12.5 million in fines, while Reggie Brown is on the hook for more than $8 million.
Katrina Brown was originally represented by Curtis Fallgatter, but Brown and her family were unable to come up with the money needed to pay for his services. Still, Fallgatter left the door open to representing her in the future.
"We're hopeful that they can pull that together, but again it's not fair to her or the court to stretch that out. The judge has been very kind to give us ... about three weeks to try to figure it out. Thought we had, but a few little problems developed that have slowed that down," he said.
A trial date was scheduled for September 4, although that date is likely to change.
This developing story will be updated.