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CEO of Colbert Co. Railcar Plant Indicted For Alleged Securities Fraud

COLBERT COUNTY, Ala. (WHNT) – The CEO of the former National Alabama Corporation has been arrested and indicted for alleged securities fraud.

The Colbert County District Attorney, along with the Alabama Securities Commission, announced the charges moments ago against Gregory James Aziz.

Gregory James Aziz (submitted)

Gregory James Aziz (submitted)

They stem from an indictment by a Colbert County grand jury charging Aziz with 10 counts of securities fraud. The indictment states between September 2006 and July 2009, Aziz perpetrated a scheme to defraud the Retirement Systems of Alabama by knowingly supplying fraudulent information and making false statements of material fact and omissions of material fact in connection with a loan and equity transaction between Aziz and the Retirement Systems.

In short, the indictment accuses Aziz and his brother, Warren Aziz, of not disclosing to RSA that they had known all along the cost to build the plant would far exceed the budget given to RSA, and it was part of their plan to keep this hidden until they had drawn and spent substantially all of the original loan proceeds.

Aziz was arrested on Tuesday, November 12 at Chicago Midway International Airport. U.S. Immigration and Customs Enforcement’s Homeland Security investigators held him and turned him over to Chicago Police, who coordinated with Alabama law enforcement. Aziz will be transported to Alabama at a later time.

If convicted, he could face up to 10 years in prison.

Aziz has hired attorneys Joe Espy, Ben Espy and Bill Espy of Montgomery to represent him.  They released a brief statement Friday afternoon.

“Greg Aziz, his family and attorneys are reviewing the claims, which they just recently received. Mr. Aziz will cooperate and is hopeful that these matters can be resolved,” the statement read.

National Alabama Corporation started as a spinoff of a Canadian freight rail car manufacturer, National Railcar, and came in a huge economic announcement for the Shoals in July of 2007. The initial hope was for the company to employ 1,800 workers.

The company was lured to northwest Alabama with $140 million in state and local incentives, and a $350 million loan from the Retirement Systems of Alabama, which manages the state pension fund.

Those jobs never materialized, because railcar industry took a substantial hit in the bad economy that followed over the next few years. RSA took control of National Alabama Corporation in 2010.

WHNT News 19 is working to get more information on this developing story. We’ll continue to update WHNT.com 

11 comments

  • Michael Kewl

    And who else in The Shoals “old’boy network” will be implicated??? As the deal has the “smell” of many more who knew and got a “piece of the pie” to put the deal together.

  • Wake Up

    See, this must be proof of how the private sector is better than government officials! Where are all my tea party friends posting complaints about corrupt private businesses and how they are proof of the failures of the free-market? . . . . . . . . . I’m waiting . . . . .

  • Jeff

    You can’t blame the economy on one man. The RSA brought steel car into the deal and then forced him out once they thought they had he right to his patents through national Alabama which only had privileges to the patents through its parent company steel car. Once they severed ties with steel car since the RSA owned 90 percent of the company they also lost privileges to the patents. I work there. I live there. I know. Bronner and the RSA run Alabama and this has been a stain on his record. He is trying to save fave. The state owes RSA 1.5 billion. He owns the courts. He will not get a fair trial.

  • Jeff

    I love Alabama and I love working for Nav star but you have to get the real story. This is classic sensationalism reporting. Us here in Bama know how things work at home, it’s an old boys club and one man runs the show. Bronner… The tea party should look into why a republican like Bronner is supporting Obama care….. Seams he flip flips on whatever benefits him at the time. He has a history I it. I’m sick of the way things work in this state.

  • Joe moniz

    Classic case of pin the tail on a donkey , U.S economy goes in the drink
    Now state is looking for a scape goat to cover there behind and keep
    Voter confidence .

  • pringles

    If he did care about his family as he had a statment, then he would never let them down for $ 1.5 billion, plus he never trusted God, but now he does, cuz there is nowhere out…..

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