The U.S. Fifth Circuit Court of Appeals in New Orleans has affirmed the criminal convictions of Walter, Rosie, and Anita Diggles, but the court has granted a request for the pastor, wife, and daughter to be allowed to gamble once they are released from federal prison. The three stole $2.27 million of state and federal funds that were intended to go to hurricane victims following hurricanes Rita and Ike in 2005 and 2008 respectively.
The appeals court ruled that although the three must pay restitution, gambling is not considered an activity that would be disallowed during supervised release.
Following their conviction in 2017 and sentencing in 2018, they immediately appealed their case. In the meantime, Walter Diggles is serving a nine year sentence in a federal prison in Beaumont, while Rosie and Anita Diggles are serving four-and-a-half year sentences in a federal prison in Dallas.
In their appeal, the three contended that there was insufficient evidence to convict them, and they also argued that if the appeals court upheld their conviction, four conditions of their supervised release, one of which was gambling, must be vacated because the district court did not read them aloud at sentencing. In their ruling, the judges wrote “We affirm their convictions and two of the disputed conditions, remanding to adjust one condition and remove another”.
The appeals judges also noted that their conditions of supervised release should have been read aloud during sentencing, but they were not.
Walter Diggles was pastor of Lighthouse Church of God in Christ in Jasper and also the executive director of the Deep East Texas Council of Government. He, his wife Rosie, and their daughter Anita headed up a program in the church known as the Deep East Texas Foundation. Federal prosecutors successfully argued that the three stole $2.27 million by funneling it through DETCOG, into the Deep East Texas Foundation, then into the church bank account, and then into their own pockets.
During their 2017 trial in the Ward R. Burk Federal Courthouse in Lufkin, federal prosecutors spent an entire afternoon showing the jury that the three spent money on extravagant vacations, luxury vehicles, massive amounts of alcohol and jewelry, and large amounts of money in the form of checks that were simply written to cash.
All of this happened as thousands of residents of this region were living in storm damaged houses with blue tarp roofs, damaged or destroyed vehicles, and unable to work because many businesses were damaged or destroyed. Federal prosecutors showed that nearly all who applied for assistance from DETCOG to receive state and federal funds were denied.