Prosecutors propose alternative to notifying thousands of potential victims in Austal fraud case

MOBILE, Ala. (WALA) - Federal prosecutors Wednesday asked a judge to allow them to use a Department of Justice website to keep potential victims up to date about developments in a fraud case against Austal USA executives.

Under the law, federal prosecutors must notify victims of their rights and of developments like court hearings.

But in the case against Craig Perciavalle, Joseph Runkel and William Adams, potential victims include all shareholders of Austal’s parent company who number in the thousands, according to Wednesday’s court filing. Notifying each of them individually is “impracticable,” the filing states.

“Indeed, although the United States has identified some of Austal Limited’s larger shareholders, the sheer number of potentially affected shareholders makes it exceedingly unlikely that the United States will ever be able to identify all of them, let alone provide individualized notice,” prosecutors wrote.

Instead, prosecutors propose, a website would provide a summary of the criminal case and significant documents. It also would have the email address and telephone number for a victim assistance line.

A grand jury in March indicted the three men on charges that they conspired to deceive shareholders from about 2013 until July 2016, using fraudulent accounting measures to make the company’s signature littoral combat ship program appear more profitable than it actually was and, as a result, inflate the stock price.

Perciavalle resigned as president in 2021 amid investigations by multiple agencies. Adams is the former program director of the littoral combat ship. And Runkel, at the time of the indictment, was the company’s director of financial analysis. All three have pleaded not guilty.

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