Stonecrest mayor to resign amid federal fraud case

Jason Lary appeared on video Tuesday morning to announce his resignation as the mayor of Stonecrest.

Credit: Jason Lary

Credit: Jason Lary

Jason Lary appeared on video Tuesday morning to announce his resignation as the mayor of Stonecrest.

Stonecrest’s founding mayor spoke at length Tuesday about his accomplishments and what he hopes to see from the city going forward — but admitted that future won’t include him.

Jason Lary, 59, announced he would resign effective 10 a.m. Wednesday, just an hour before he’s set to appear in federal court to change his not guilty plea on charges that could land him in prison. The mayor faces three felonies after being accused of stealing more than $650,000 in COVID-19 relief funds to cover personal tax liabilities and pay off a lakehouse mortgage.

Lary didn’t mention the criminal charges or his tumultuous last year in office during the news conference. Instead, he tried to cement his legacy as the trailblazer who founded a city that is now the most populous in DeKalb County.

“Frankly folks, I gave the last 10 years of my life to this, and I wouldn’t take back one day,” Lary said during the virtual meeting. “I’m proud to be the visionary. I’m proud to be the leader.”

The 45-minute Zoom call went off the rails during its middle portion due to hackers, but the expletives, racial slurs and flashes of nudity shown during the call didn’t deter Lary from trying to control the narrative for his departure from office. Lary did not field questions. (Due to explicit content, the video of the news conference is not embedded in this article.)

“It’s time for me to retire from politics and really get focused on my health,” Lary said, referencing his multiple bouts with cancer. At one point during the meeting, he took a breath from an inhaler. “... In closing, I ask that you all measure me by the whole story. I did the best that I could do with what we had in place.”

In November, federal prosecutors took Lary to court over allegedly defrauding the Coronavirus Aid, Relief and Economic Security (CARES) Act through the use of a kickback scheme. Lary is accused of requiring small businesses and churches that received grants to give 25% of their award to companies connected to himself and co-conspirators. He faces counts of wire fraud, conspiracy to commit federal program theft and federal program theft.

Prosecutors said Lary helped decide where relief funds were directed, including an unsolicited $150,000 grant award to his church. In return, the church was asked to give $50,000 to one of the companies, which Lary allegedly used to pay off various personal tax liabilities. Prosecutors also found that $108,000 of relief funds were used to pay off the mortgage on a lakefront home owned by Lary.

During Tuesday’s news conference, Lary continued to tout aspects of the city’s CARES Act program, namely the group Stonecrest Cares. The entity, which is not a registered nonprofit, was created by two city employees and was supposed to distribute $855,000 to nonprofits and churches.

“We closed a need. We gave away gifts and toys and made sure that folks’ needs were met. And that should be one of the cornerstones of what we do here in Stonecrest,” Lary said, arguing that the entity should be reinstated and continued with more support from the city.

However, an internal investigation found that less than half of the funds given to Stonecrest Cares was distributed. Stonecrest Cares also used some relief funds to separately pay consultants for some bewildering services, including tens of thousands of dollars for stress-release programs, stress packages that included candles and tea, financial education services and massages for city staff members.

Lary continued to praise many former city employees who were implicated in the CARES Act scandal and subsequently fired and replaced.

Clarence Boone, the city’s former economic development director, was among the people the mayor named. Boone’s wife, Lania Boone, was arraigned on a conspiracy charge in relation to the alleged fraud scheme. She was the bookkeeper for the company hired by Stonecrest to distribute its federal relief funds. The next court hearing for Boone, 60, has not been scheduled.

Lary previously pleaded not guilty to the charges, but the change of plea hearing signals a likely plea deal. His attorney, Dwight Thomas, teased that result during Lary’s initial Nov. 10 court appearance by saying, “He accepts full responsibility, and there won’t be a jury trial.”

According to the city’s charter, a special election will take place because Lary’s term was supposed to last through the end of 2023. He won reelection in 2019 with 55% of the vote.

Acting City Manager Janice Allen Jackson told The Atlanta Journal-Constitution the city is “researching this matter,” adding that city leaders will likely discuss special election options during their Jan. 10 work session.

Our reporting

The Atlanta Journal-Constitution has covered the allegations against Lary and his alleged abuse of the Stonecrest’s CARES Act program throughout 2021. The AJC was the first news outlet to obtain the internal investigative report into the alleged kickback scheme in April and report its details. Since then, the AJC has published more than two dozen stories diving into the allegations, the structure of the alleged scheme and the investigation’s fallout.