The founder of a Myrtle Beach, S.C.-area nonprofit aimed at assisting homeless veterans pleaded guilty to federal charges related to money laundering.
James "Billy" Arehart signed the plea deal last month, agreeing to be sentenced on one count of engaging in a monetary transaction with property derived from unlawful activity, court records show. The U.S. Attorney's Office agreed to drop other charges, including mail and wire fraud, as part of the deal.
Bill Dinkin, an attorney representing Arehart, wrote in a statement that "by entering a guilty plea, Mr. Arehart has taken responsibility for his conduct" and "despite his mistakes, he has been a tremendous asset and source of support to both active duty military personnel and veterans, particularly homeless veterans."
Arehart's nonprofit Providing Hope Va had announced plans in early 2023 to open a Veterans resource center in Loris. The city annexed the property off Highway 701 South, and the charity solicited funds for the project, but Arehart just used those funds "as he saw fit," according to the indictment.
That property remains vacant, and the Providing Hope Va website only shows the message: "We are taking a break. We want to thank you all for the support and community you have shown for the past several years."
Arehart originally founded the nonprofit in 2018 while living in Virginia before relocating operations in 2020 to Loris, court records show. Through 2021, he raised more than $9 million primarily by selling tickets to raffles for high-end vehicles by advertising through Facebook.
Arehart falsely represented to the public that money spent on raffle tickets was tax deductible, despite IRS code specifically restricting deductions for purchases of games-of-chance tickets, he admitted as part of the plea deal. That caused ticket purchasers to submit fraudulent tax deductions to the IRS.
Arehart, who had sole control of the nonprofit's finances, awarded himself an increasing amount of salary and bonuses from its funds, including $162,000 in 2019, $292,000 in 2020 and $525,000 in 2021, the Department of Justice alleged.
Arehart is set to be sentenced Feb. 20, 2025, and faces up to 10 years in prison and fines more than $250,000, though the plea deal stipulates that the government will recommend a lower sentence, likely in line with Arehart's request for 18 months in prison. He must also forfeit any assets he possesses that are related to his crime.
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