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Former Wellco Executives Indicted for ‘Made In USA’ Fraud

On September 13, 2016, a federal grand jury in Greeneville returned an indictment against Vincent Lee Ferguson, 65, of Knoxville, Tenn.; Matthew Lee Ferguson, 40, of Lenoir City, Tenn.; Kerry Joseph Ferguson, 35, of Houston, Texas; Matthew Harrison Martland, 32, of Knoxville, Tenn.; and Stephanie Lynn Kaemmerer, 44, of Knoxville, Tenn., for wire fraud, conspiracy to commit wire fraud, major fraud against the United States, and smuggling goods into the United States.

They are former employees of Wellco Enterprises, a now defunct footwear manufacturer which sold boots to the US military. Vincent Ferguson was president and CEO from 2006 to 2012, Matthew Ferguson was senior vice president of sales, Kerry Ferguson was marketing director, Matthew Martland was director of distribution and logistics and Stephanie Kaemmerer was inside sales manager and operations manager at Wellco.

Wellco had a rich history in military footwear for over half a century. In fact, their Rosearch business unit held the IP for several direct molded sole systems including the Jungle Boot’s Panama sole and the legendary footprint sole developed experimentally for MACV SOG’s cross border operations. Wellco was bundled with Altama and sold out of Ch 11 bankruptcy to Original SWAT in 2014 to form Original Footwear.

Investigations by Homeland Security, the Defense Criminal Investigative Service, Air Force Office of Special Investigation, General Services Administration Office of Inspector General, and the Defense Contracts Audit Agency found that Wellco substituted Berry compliant boots with those Made in China in order collect a larger profit from the sale of the boots to the military as well as others, including the public.

If convicted, they all face a term of 20 years in prison as to each wire fraud charge and smuggling charge, and up to 10 years in prison for the charge of major fraud against the United States. Additionally, they face fines of up to $250,000 and up to three years of supervised release as to each count. The indictment also seeks forfeiture of approximately $8.1 million.

15 Responses to “Former Wellco Executives Indicted for ‘Made In USA’ Fraud”

  1. SShink says:

    Despicable…They like the Chinese so much, send them to a Chinese prison.

  2. GOAT says:

    Not the first time or last time this has happened. Greed overcomes morals in some.

  3. Former Customer says:

    Holy crap…I used to buy boots from these guy in the hundreds to sell on military bases. I dealt with Matt on many occasions. It’s hard to believe they would do this. If it’s true, I am very disheartened to know that a family who seemed so patriotic and espoused how great their boots were and that they were made in the US pulled a switcharoo and sold China products to our military. Matt always seemed like a very genuine and nice guy. The sad part is, they are probably not the only ones who do this. I know GSA is famous for having products listed as “Made in the USA”, but in fact, a quick search or phone call will confirm they are in fact made in China or elsewhere.

    • Tish says:

      I have worked with Matt and his wife for the past 4 years and they are both genuine. Everyone can have their opinions but truth is nothing has been proven and I don’t agree with people downing their character when there has not been any charges yet. No one thinks of what this does to people’s families Matt and his wife have a 1 yr old. He is a great dad, coworker, executive, and husband to his, wife. Saying that his 1 yr old deserves to grow up without her father is absurd especially for something he didn’t do. Our system is screwed up we charge innocent people and we let guilty people like casey Anthony run free.

  4. Philip says:

    My first basic training-issued pair on active duty were Wellco’s. Ditched them after advanced training. Poorly put together with a cheap feel and not very durable. Thought they were utter garbage. Now I know why!

  5. Chuck says:

    Damn, I’m from Knoxville and used to work with a guy whose family is involved in this. Gave me some free boots before I deployed in ’09.

  6. Lasse says:

    the footwear business ain’t easy

  7. Mike says:

    Kinda cool to see AFOSI cited. Good job agents.

    -Mike

  8. Matthew Kime says:

    But on the other hand… Best SHOT Show Give-Away pens ever!

  9. Brent says:

    They didn’t pay off the right people.

  10. MiamiC70 says:

    How many others on the made in the USA bandwagon are doing the same?

  11. Tipster1616 says:

    I used to work for Lee and knew the kids as well. There wasn’t a half intelligent one among the bunch. Since daddy was the CEO he made sure to reward the little ones with high ranking titles, and excellent pay and bonuses. We couldn’t understand how Wellco would win DoD contracts with bids well below the best offer of any and all competitors. Then the rumors started going around regarding the Made in China scheme, but nobody dared stand up to the little tyrant and his Napoleon complex. Glad to see karma finally caught up with all of them.

  12. Maskirovka says:

    Way back when, like 2003, TuffKushion jungles were one of my favorite things.