NC SBI finishes probe into James ‘Smuggie’ Mitchell’s RJ Leeper ownership claim
The North Carolina State Bureau of Investigation says it has finished its investigation into Charlotte City Councilman James “Smuggie” Mitchell’s ownership in construction firm R.J. Leeper.
Mitchell, who won a seat on the City Council earlier this year, repeatedly claimed to own a 25% stake in the construction company, which has contracts with the city of Charlotte, despite it being illegal under North Carolina law. R.J. Leeper contested Mitchell’s ownership stake and the controversy caused Mecklenburg County District Attorney Spencer Merriweather to ask the state to investigate.
SBI spokeswoman Anjanette Grube told The Charlotte Observer the agency finished and submitted its findings to the district attorney this week.
Merriweather on Wednesday confirmed to the Observer he received results of the SBI investigation and started reviewing the contents. He’ll determine what’s next, including if criminal charges are appropriate, but said he didn’t have a time frame for his next step.
Mitchell didn’t know the investigation was complete when an Observer reporter reached him Wednesday evening.
“I was hoping to bring this to a close in 2022,” Mitchell said. “I look forward to them reaching out to me to let me know the investigation is complete.”
He didn’t comment on how he’ll proceed, saying he’ll wait until he sees the results of the investigation.
Under North Carolina law, it’s illegal for a city to do business with a company if a member of the city’s governing board owns more than 10%. R.J. Leeper has active contracts with the city for projects at Charlotte Douglas International Airport and the Charlotte Convention Center.
The City Council also has yet to sign off on the first phase of a wastewater treatment plant project led by a joint venture involving R.J. Leeper and PC Construction. The item was pulled from a council agenda in November and did not appear on the council’s agendas in December either. It’s unclear why the project was delayed by city staff and the city attorney did not say why it was removed from the November agenda.
Mitchell’s claim to an ownership stake faces significant evidence to the contrary, including a Sept. 13 statement to the Observer from R.J. Leeper COO Lorie Spratley.
“Mr. Mitchell has never owned a direct ownership interest in R.J. Leeper Construction, LLC,” Spratley said. “He previously owned 25% of Bright Hope Construction, LLC, a parent entity for R.J. Leeper Construction, LLC.”
Records provided to the city from the company’s lawyers say Mitchell lost his stake in Bright Hope after he failed to repay a $375,000 company loan, money designed specifically for Mitchell to buy into the company in the first place.
In late December 2020, Mitchell became president and CEO of R.J. Leeper Construction while he was a member of the city council. This resulted in a similar legal issue to the one he’s facing now and forced him to resign from his longtime council seat in January 2021.
Mitchell left Leeper after six months but said at the time he was retaining his 25% share of Bright Hope.
This story was originally published December 21, 2022 at 5:31 PM.
