Five executives with a former leading manufacturer of U.S. military boots have been sentenced in federal court for saying the boots were made in Tennessee when they were actually produced in China.
According to an indictment filed in U.S. District Court, the actual Chinese manufacturer of the boots was told to include "USA" on the label of Wellco boot uppers that were then shipped to the U.S. The "Made in China" tags were removed, the indictment says. Soles were affixed to the boots at Wellco's plant in Morristown, Tennessee, and elsewhere, according to the document.
From 2006 through 2012, the U.S. Department of Defense paid at least $138 million to Wellco for military footwear, according to the indictment.
Two of the executives with manufacturer Wellco Enterprises were sentenced in U.S. District Court in Greeneville, Tenn., to six months in prison, the Kingsport (Tenn.) Times News reported. The others received probation.
Digital Access for only $0.99
For the most comprehensive local coverage, subscribe today.
A sixth executive, Vincent Ferguson, who was the company's president and CEO, will be sentenced later this year, according to the newspaper.
All six previously pleaded guilty in the case, court records show.
Ferguson and two others pleaded guilty to conspiracy to commit wire fraud. Two others pleaded guilty to smuggling goods into the U.S., and one other executive to aiding and abetting the altering of country of origin marks, according to their plea agreements filed in court in January.
The indictment filed in September 2016 accused the six of marketing and selling at least $8 million of boots from December 2008 to August 2012 to the U.S. government, government contractors and the public "that were falsely represented as 'Made in the USA ...."
Wellco Enterprises was a leading manufacturer and supplier of military and other "rugged footwear for over 70 years, the indictment says. The company was founded in 1941 in Waynesville, N.C.
According to a U.S. Department of Justice news release in February, Vincent Ferguson, 66, of Knoxville, Tennessee, pleaded guilty on Feb. 15 to conspiracy to commit wire fraud.
Also pleading guilty to conspiracy to commit wire fraud were Ferguson's sons, Wellco’s former senior vice president of sales, Matthew Lee Ferguson, 41, of Geneva, Illinois; and the company's former director of marketing and communications, Kerry Joseph Ferguson, 36, of Houston, Texas, according to the release.
Wellco’s former vice president of government contracting, Neil Streeter, 55, of Warren, Massachusetts, and former operations manager Stephanie Lynn (Ferguson) Kaemmerer, 45, of Knoxville, pleaded guilty to smuggling goods into the United States. She is Vincent Ferguson's daughter.
Matthew Harrison Martland, former director of distribution and logistics, aiding and abetting the altering of county of origin marks, the Times News reported.
Staff researcher Maria David contributed.