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Two weeks after searching his office, FBI agents arrest Muncie building commissioner

Posted at 3:29 PM, Feb 15, 2017
and last updated 2017-02-15 16:27:02-05

MUNCIE, Ind. -- Federal agents arrested Muncie Building Commissioner Craig Nichols Wednesday – a little less than two weeks after the FBI searched his home and office.

According to a federal indictment unsealed Wednesday, Nichols, 38, faces charges of wire fraud, theft and money laundering stemming from a year-long investigation into city building permits.

The indictment alleges that Nichols abused his position of trust by using sham bidding practices and submitting fraudulent invoices to steer work to his companies, and then bill Muncie more than $376,000 for work his company either never performed or performed at inflated prices. 

“Seeking out and investigating public officials who exploit their official position for personal gain ranks number one on the FBI’s criminal priorities list and is the sole purpose of the Indiana Public Corruption Task Force,” said FBI Special Agent in Charge W. Jay Abbott.  “The indictment and arrest of the City of Muncie Building Commissioner Craig Nichols is one more step in an ongoing investigation which seeks to identify and bring to justice any and all public officials or private citizens who have committed federal crimes and victimized the tax paying citizens of Muncie, Indiana."

On January 2, FBI agents removed boxes of documents, some labeled "building permits," from Nichols' office in Muncie.

MORE | FBI removes documents during search of Muncie building commissioner's office

The FBI did not say what it was looking for at the time, but Nichols faced a federal lawsuit last year accusing him of colluding with other city officials to prevent companies from getting city demolition contracts so that he could have them for his own companies. The lawsuit was later dismissed.

In a statement earlier this month, Mayor Dennis Tyler said the city, "intends to cooperate fully in this investigation, and looks forward to a complete and early resolution of any issues."

The city of Muncie released a short statement Wednesday about Nichols' arrest:

"The city of Muncie has been told that an indictment has been returned naming Craig Nichols as a defendant.

The city has neither received a copy nor had any communications of the indictment except press inquiries.

The city is attempting to obtain a copy of the indictment. Assuming the city is able to gain a copy, there will be a press conference tomorrow, Thursday, February 16, 2017, at 11 a.m. in the Mayor's Conference Room."