The legal troubles for councilwoman Katrina Brown continue – and those troubles have entangled another member of city council as well.
Just a week after the city filed suit against Brown’s family company, Jerome Brown BBQ Sauce, to recover over $300,000 in unpaid loans, it was announced this morning that Brown and fellow council member Reggie Brown have been indicted on over 30 counts pertaining to mail and wire fraud, and the conspiracy to commit those crimes.
The newly-unsealed indictment details the alleged scheme by Katrina Brown and Reggie Brown – who is not a member of the Brown family involved with Jerome Brown BBQ Sauce – to defraud both the city and the Small Business Administration.
In 2011, city council voted to approve a loan for Jerome Brown BBQ Sauce – Katrina Brown’s family business – to allow them to purchase the property at 5638 Commonwealth Ave. to use as a manufacturing plant for their BBQ sauce, which was being sold at Walmart and Sam’s Club locations. The new plant was supposed to bring 56 sustainable jobs to Jax.
The business’s parent company, Cowealth, also secured a $2.6 million loan from the SBA to renovate that property and start production.
Unfortunately for the Brown family, business didn’t take off in the way that was anticipated. And rather than reporting this to the city or the SBA, the indictment alleges that Katrina Brown then began a conspiracy with Reggie Brown to generate false revenue for Jerome Brown BBQ Sauce.
Multiple shell companies were formed by Katrina, with Reggie named as the principal. Those companies then secured SBA loans under the guise of needing to repay costs of services rendered to another shell company related to Jerome Brown BBQ Sauce – services that never took place, as the shell companies never actually did anything.
Jerome Brown BBQ Sauce ultimately went bankrupt, and the Commonwealth Ave. property entered foreclosure. Katrina Brown, meanwhile, was elected to city council in 2015
In addition to the suit it faces from the city, the SBA is also seeking to recover what it’s owed from the company on their $2.6 million loan.
Katrina Brown represents the city’s 8th district – she recently proposed a “Homeless Bill of Rights” ordinance in city council. Reggie Brown represents the 10th district, and has served on the city council since 2008.
So far, city council has not issued any statement on the matter. A statement from the attorneys for both council members maintains their clients’ innocence.
UPDATE:Both council members have been removed from all current committee positions.