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Upstate South Carolina Executive Scandal: An Update

Company investigation uncovers alleged “improper personal misappropriation of assets.”

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Early last month, our news outlet reported on the abrupt resignation (termination?) of a prominent Upstate South Carolina executive.

The fall of Jody Gallagher – which is the focus of a federal fraud investigation – peaked our audience’s interest given his alleged proximity to another federal inquiry involving the infamous Thornblade scandal of 2020.

Gallagher, 65, of Greenville, S.C., was president and chief executive officer of AFL Global – a Japanese-owned company headquartered in Duncan, S.C. AFL is a subsidiary of Fujikura, a Tokyo-based telecommunications firm. According to its website, AFL works with “very large energy and service providers” as well as small businesses in deploying fiber optic networks.

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Gallagher resigned two months ago in connection with an internal corporate investigation into “the improper personal misappropriation of assets” of AFL Global.

Gallagher is also a former president of the Thornblade Club – an exclusive private club located within an upscale Greer, S.C. neighborhood of the same name. As recently as 2021, he was still a member of its governing board. Thornblade is located about five miles east of Greenville, S.C. and is (or was) best known for hosting an annual charity golf tournament sponsored by BMW.

Now, Thornblade will be forever linked to a summer of scandal that has yet to be fully resolved …

In the summer of 2020, allegations of embezzlement and other financial irregularities at the club morphed into reports of a rumored prostitution ring (or “sex ring”) involving multiple residents in the Thornblade neighborhood. The rumored sex ring was probed by the U.S. Department of Homeland Security (DHS)’s special investigations unit (HSI) – the same agency currently investigating allegations of underage sex crimes tied to the Rockstar Cheer scandal.

What happened to the Thornblade investigation? As I noted last summer, federal and state prosecutors were unable to prove anything beyond sexual activity among consenting “adults.” Meanwhile everyone associated with this saga reportedly “lawyered up” and “paid a pretty penny to make the whole thing go away.”

Documents released by local authorities in connection with the scandal were also heavily redacted.

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RELATED | THORNBLADE FILE RELEASE

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On May 26, 2023, Fujikura chief executive officer Naoki Okada sent a memo to company employees informing them Gallagher was “no longer employed with AFL in any capacity.” Okada indicated Gallagher had been replaced by Jaxon Lang – a move which was formally announced on June 6, 2023 in response to Gallagher’s “resignation from his position.”

Late last month, Fujikura released an update on the situation.

In a memo dated June 29, 2023, the company informed its employees of the “suspected private misappropriation of real estate” by Gallagher. This alleged misappropriation was raised by a “whistle-blowing” on March 3, 2023. That complaint led to the launch of an independent investigation less than two weeks later – on March 14, 2023.

During this internal inquiry, “(investigators) uncovered the possibility of occurrences of similar incidents in addition to the (whistle-blowing) incident.”

“We are still continuing the investigation at this moment to grasp the whole details on the incident and other similar incidents,” the update noted.

That investigation was reportedly concluded on June 30, 2023, however the company indicated it would “take considerable time” to analyze and assess its findings.

According to the memo, the whistleblower drew the firm’s attention to “an improper acquisition” made by Gallagher with respect to “land purchased in 2020 and a building built in 2022.” The total value of this alleged misappropriation? An estimated $6.5 million.

(Click to View)

Jody Gallagher (AFL)

In addition to this alleged acquisition, “we found other suspicious cases such as investments in unlisted securities by the U.S. subsidiary under the direction of the director and the director’s use of other assets of the subsidiary including aircraft and credit cards,” items which required “further investigation … to clarify if any misconduct occurred or not.”

Among these expenditures?

  • Multiple unlisted securities investments directed and executed by the director in 2018 and thereafter,
  • The use of corporate credit cards by the director,
  • The purchase and use of aircraft by the director, and
  • Payments for membership fees to a golf club by the U.S. subsidiary

The memo hinted at the existence of the federal inquiry, indicating the company would determine how to respond to the situation “after coordinating with the relevant authorities.”

“We deeply apologize to our shareholders and all other concerned parties for any inconvenience and concern this may cause,” the memo concluded. “We will fully cooperate with the external specialists and auditing firms, and will make every effort to finalize the settlement of accounts as soon as possible.”

Gallagher took the reins of AFL in 2003. He was also a member of Fujikura’s board of directors – its first and only American member, in fact. In January of this year, Gallagher was named as one of the fifty “most influential” businessmen in the Upstate, according to Greenville Business Magazine.

Count on this news outlet to keep our audience up to speed on the latest developments in this case.

To view the latest Fujikura update for yourself, download the document below …

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INVESTIGATION UPDATE …

(Via: Fujikura)

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ABOUT THE AUTHOR …

Will Folks (Brett Flashnick)

Will Folks is the founding editor of the news outlet you are currently reading. Prior to founding FITSNews, he served as press secretary to the governor of South Carolina. He lives in the Midlands region of the state with his wife and seven children.

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1 comment

Anonymous March 26, 2024 at 1:31 pm

Perhaps well deserved?

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