3 men ordered to pay $50K in connection with East Palestine derailment charity scam

The Ohio Attorney General’s Office has ordered three men to pay more than $50,000 in fines and restitution because it said they were involved with a phony charity created in the wake of the East Palestine train derailment in February.

One of the men is a former campaign manager for Republican Congresswoman Marjorie Taylor Greene of Georgia.

Ohio Attorney General Dave Yost said in a statement that he began investigating a group called the Ohio Clean Water Fund that was accused of fundraising for an East Palestine-area food bank without permission.

Yost’s office said the Ohio Clean Water Fund, founded by Michael Peppel, raised nearly $149,000 from donors in the aftermath of the derailment, but only donated $10,000 to the Second Harvest Food Bank of the Mahoning Valley. WAMA Strategies, a group formed by Luke Mahoney and former Greene campaign manager Isaiah Wartman, conducted fundraising for the fund. Wartman managed Greene’s 2020 campaign.

“These scammers preyed on generous donors to try to line their own pockets, but ultimately were stopped and shut down,” said Yost.

Under the settlement, Peppel must pay a $25,000 civil penalty and is permanently banned from incorporating, operating or soliciting for any charity in Ohio. Mahoney and Wartman must pay just more than $22,000 in restitution to Second Harvest and $3,000 to the Ohio Attorney General office for investigative costs.

WAMA is prohibited for four years from soliciting for a charity in Ohio, and Mahoney is prohibited for four years from incorporating, operating or soliciting for a charity in Ohio, according to the attorney general’s office.

WAMA attorney Bryan Kostura told Cleveland.com that Wartman and Mahoney provided documents to assist Yost’s investigation and that the two men were victims of a fraud perpetrated by Peppel and were “were just as bamboozled as the people that donated money” to the Ohio Clean Water Fund.

It has been six months since a Norfolk Southern train derailed in East Palestine, sending toxic chemicals into a nearby stream. Days after, a controlled chemical burn spewed plumes of black smoke into the air. The small Ohio town and nearby communities, including rural sections of Beaver County, have been fighting to recover since.

Thursday’s settlement came after a June 1 settlement in which the Ohio Clean Water Fund was forced to dissolve and pay nearly $117,000 in restitution to Second Harvest and $15,000 in civil penalties.

In a statement, Second Harvest Director Michael Iberis said the food bank will be announcing soon how the funds will be used to assist residents.