UPDATE 8/3/13 @ 9:00 p.m.
CHARLESTON, W.Va. (WSAZ) -- A popular Charleston festival celebrated its 24th year this weekend despite nearly being derailed by scandal.
Multi-Fest filled the Capitol Complex with large crowds and loud music Saturday. Organizers say the anniversary is an even more significant milestone.
"This is a new start for us...a positive start," said committee member Threece Clements- Townsend. "It's very emotional. We determined that no weapon formed against us should prosper."
Earlier this year, former treasurer Debbie Starks pleaded guilty to embezzling more than $300,000 from Multi-Fest. She was sentenced to nearly two years in jail.
The shake-up left organizers picking up the pieces and making big changes.
"We've added CPAs, and we've gotten lawyers involved with us to make sure everything's correct and accurate," Multi-Fest Vice President JoLoyd said.
Committee members say they also worked closely with officials at the city, county, and state level to restore credibility and re-organize leadership.
William Terry says he looks forward to the event every year like hundreds of others in the region, and is happy to see it come back with a bang.
"It's like family," he said. "Everybody out here is getting along and having fun, even if they don't know [each other.]"
Board members say they lost more than $10,000 worth of sponsorship after the scandal struck, which restricted entertainment costs this year.
However, they say the quality of the celebration remains as strong as ever.
"We've always been moving, and trying to make sure the 24th anniversary is the best one we've ever seen," JoLoyd said.
UPDATE 4/16/13 @ 3:15 p.m.
CHARLESTON, W.Va. (WSAZ) -- Former MultiFest Director Deborah Starks, will spend nearly two years behind bars after admitting to stealing more than $300,000 from MultiFest.
According to a news release from U.S. Attorney Booth Goodwin, Starks, 55, of Cross Lanes, W.Va., previously admitted that she filed a false tax return in connection with an embezzlement scheme that drained more than $300,000 from MultiFest.
"Ms. Starks failed to report more than half a million dollars of income on her taxes. More than $300,000 of that unreported income was money she stole from Multifest,” said U.S. Attorney Booth Goodwin. “Stealing $300,000 from a small business or charity could easily put that organization out of business. That's why my office has focused on investigating and prosecuting cases like these, to protect small businesses and charities and to send a clear message that stealing from them won’t be tolerated."
According to the release, Starks was the treasurer for MultiFest while the money was being stolen. During that time, Starks was in charge of revenue and expenses for MultiFest and maintained the organization’s bank accounts.
According to the release, Starks admitted that beginning in or about 2005 and continuing until 2010, she embezzled approximately $306,000 from MultiFest. She also admitted additional unreported taxable income of approximately $200,000. Starks further admitted that she wrote personal checks to herself and to other people, withdrew cash in the form of checks, and made ATM transactions from MultiFest bank accounts during the scheme. Starks also admitted that the embezzled funds were used primarily to support her personal gambling activities.
In addition to the embezzlement scheme, according to the release, Starks admitted that she prepared, signed and filed a joint U.S. Individual Income Tax Return for 2005, 2006, 2007, 2008, 2009 and 2010 and did not report the embezzled funds as income.
The Court ordered Starks to pay restitution to MultiFest in the amount of $306,872.04 and the IRS in the amount of $128,626.
Longtime MultiFest director Deborah Starks pleaded guilty last month to tax fraud in connection with an embezzlement scheme. Prosecutors say she pocketed more than $300,000 from the event over a five-year period.
Starks co-founded the event with her husband Stephen. He has since stepped down.
MultiFest leaders say they won't see the institution defeated after seeing success for more than two decades.
They held a special town hall-style meeting Saturday night to spread the message of starting over and reveal their steps toward change.
"We've become transparent and we're trying to get our credibility back," executive director Vicky Keene said. "It was a complete shock and we try not to revisit the past...because we feel that MultiFest is bigger than two people."
Keene says they've hired a CPA to pay bills and now oversee all cash flow. They also brought in new board members and wrote bylaws with the help of a lawyer.
"We go into our meetings as a business, not just as a festival," she said. "We are a corporation, so we tend to our business the way business should be tended to."
Minnie Leonard feels MultiFest is an important part of the city's identity that must go on.
"It's a festival of all cultures and it brings people together," she said.
Leaders say they're still in talks with the mayor and county commissioners to ensure transparency.
They also say individuals on the board have been bonded as an added precaution.
Deborah S. Starks, 55, of Cross Lanes, entered the guilty plea to the crime during a hearing in U.S. District Court in Charleston Friday.
Prosecutors say Starks was the treasurer of MultiCultural Festival of WV (MultiFest) at the time of the scheme.
Starks admitted that beginning in, or about, 2005 and continuing until 2010, she embezzled approximately $306,000 from MultiFest. She also admitted additional unreported taxable income of approximately $200,000.
Starks further admitted that she wrote personal checks to herself and to other people, withdrew cash in the form of checks, and made ATM transactions from MultiFest bank accounts during the scheme.
In addition to the embezzlement scheme, the defendant admitted that she prepared, signed and filed a joint U.S. Individual Income Tax Return for each of the calendar years 2005, 2006, 2007, 2008, 2009 and 2010 and did not report the embezzled funds as income.
“Obviously $300,000 is a substantial amount of money to any company, but it's especially significant to a small business or charity. That's why my office has focused on investigating and prosecuting cases like these to protect such organizations and to send a clear message that such conduct will not be tolerated in this district," said U.S. Attorney Booth Goodwin.
Starks has agreed to pay $306,872.04 in restitution to MultiFest and $128,626 to the IRS. She also faces up to three years in prison and a $250,000 fine when she is sentenced in April.
Starks co-founded the annual event with husband Stephen in the early 1990s. Currently held on the state Capitol grounds, MultiFest offers a mix of food, arts, crafts, music and other entertainment one weekend each summer.
Following the announcement of the guilty plea, the Kanawha County Commission issued the following statement.
"The community and Multi-Fest deserve better. If Multi-Fest is able to continue and wishes to receive funding in the future from the Kanawha County Commission, those running Multi-Fest will have to be strictly accountable and there must be honest people in charge,” said Commission President Kent Carper.
Commissioners say they support the overall purpose of Multi-Fest and have been a participant in the past.
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