This is an archived article and the information in the article may be outdated. Please look at the time stamp on the story to see when it was last updated.

MUNCIE, Ind. – It was in the spring of 2013 when Les Marsh said he first noted the stench of potential corruption emanating from Muncie City Hall.

“I don’t have to be a refrigerator to know the light goes off when you close the door.”

What followed was the former town marshal’s investigation into bid rigging, fraudulent contracts and theft that will result in the sentencing of Muncie’s former building commissioner this week, just a first step in what Marsh believes will be a wider federal corruption probe that will snare up several top officials before it is over.

“It was no surprise,” he said. “The scope of it was a surprise. Even I didn’t think these people could steal that much.”

What got the attention of the FBI, and led to references to Marsh’s investigation in the Nichols’ sentencing memorandum filed by the U.S. Attorney last week, is the finding that the son of ex-Councilman and former Delaware County Democratic Party Chairman Phil Nichols fraudulently billed the city of Muncie for home demolitions that never occurred.

“We got a tip that they were tearing down empty lots,” said Marsh, “and we went to the building commissioner’s office and wanted to know where the permits were. The demolition permits.”

What Marsh and his sources discovered was Nichols falsely billed the city for demolishing four properties that didn’t exist, then found out the whistleblower was on his tail and concocted a cover-up scheme that was discussed in front of his father and Muncie Mayor Dennis Tyler and other municipal employees.

“Nichols deposited the checks, sat back, and hoped that no one would notice he just stole $81,500 from Muncie,” reads the sentencing memorandum. “But, someone did notice….Les Marsh (concerned citizen/government watchdog) made a public records request for invoices related to the demolitions.

“Les Marsh and others figured it out.

“Knowing that his theft had either already or was about to be discovered, Nichols panicked.”

What follows in the memorandum to the federal judge is an explanation of Nichols’ cover-up and meetings, “to discuss how to address the issues with Nichols’ invoices,” attended by the mayor. When one of the participants later told Tyler that the attempted cover-up was ill-conceived and would never work, “the Mayor neither said nor did anything in response.”

Tyler was unavailable for comment Monday and told the Muncie Star Press that out of respect for the FBI’s investigative process he would not issue a statement.

The U.S. Attorney is asking for a, “lengthy term of imprisonment,” for Nichols.

“We were lucky to get it over to the FBI,” said Marsh. “A couple days later we met again and they said, ‘Yes, you are right,’ and they’ve told us very little along the way but what they have told us is that the amounts of money are unbelievable.

“What we gave the FBI, we figured somewhere between a half a million and a million dollars had been misappropriated and we had no idea the percentage we had… probably not 10 or 15 percent of the total thing.

“I think you’re probably eventually gonna see bid rigging after this.”

Marsh’s history as a town marshal, and knowledge of how Muncie operates based on the experiences of relatives who served in the city’s police department, leads him to believe the corruption probed by the FBI is pervasive in city government.

“The little bit they told us is they’re not done and they’re going up the food chain.”

Marsh said he has been targeted for intimidation since word got out about his investigation and cooperation with federal authorities.

“I watch but I don’t worry. Do I think they’re coming after me? Not personally. i think they’re too gutless to do that but they stole a lot of money,” he said, “and I’m just too stubborn to quit.”

Marsh said an associate has an FBI code name and other sources put their city jobs on the line to furnish him with information.

“I’m just an old time shoe leather investigator.

“I just knock on doors and that’s how I get my information.”