DIXIE, WV (WVNS) — A man from North Carolina pleaded guilty to providing false statements to the U.S. Department of Agriculture about coal he pledged as collateral for a USDA-backed loan.

Court documents stated Michael James Peters, 42, of Concord, North Carolina, was once the part-owner, President, and operator of Taylor Rose Energy (TRE). In July of 2014, TRE received a loan from a Georgia bank totaling $9,065,165. The loan was reportedly for TRE to buy out investors’ interest in 146,954 tons of cannel coal in Dixie, Nicholas County.

In support of the loan, TRE said it intended to convert the coal into “smokeless” coal briquettes for consumer coal-burning home heating systems in Ireland. The USDA Rural Development Business and Industry loan program guaranteed 90 percent of the loan.

According to court documents, once January 2015 came around, Peters owed more than $1.3 million to an owner/operator of a separate coal company in Kentucky. From February 2015 to April 2015, Peters let the Kentucky company, Aces High Coal Sales Inc., to remove more than 80,000 tons of the collateralized coal from the Nicholas County site to settle his debt.

At this time, Peters was unable to pay back the original USDA-backed loan. He did not inform the Georgia bank of his inability to pay or that coal was being removed from the site to settle a different debt.

Michael Peters reportedly told the bank in Georgia that 90 percent of the coal had gone “missing” from the site in Nicholas County. In May 2015, representatives from the USDA and bank in Georgia travelled to the site in Dixie, West Virginia to investigate the coal removal.

Peters then falsely told the representatives that Aces High had taken the coal of the Dixie site without his permission. During his plea hearing, Peters admitted this was a lie in an attempt to redirect the investigation.

Michael James Peters pleaded guilty to making a false statement to a representative of the United States Department of Agriculture. He is scheduled to be sentenced on January 19, 2023, where he faces a maximum sentence of five years in prison followed by three years supervised release. A $250,000 fine could accompany his jail time.

Within his plea agreement, Peters agreed to pay $1,375,000 in restitution.

United States District Judge Irene C. Berger presided over the hearing. Assistant United States Attorney Andrew J. Tessman is prosecuting the case.