Two men, one of them from Blue Springs, have been indicted by a federal grand jury for embezzling more than $388,000 from their employers by pocketing proceeds from redeemed scrap metal.

Russell Fotovich, 46, of Kansas City and 48-year-old Thomas Ray Jones of Blue Springs were charged in a 13-count indictment returned Tuesday by a federal grand jury in Kansas City. The indictment was unsealed Friday when Fotovich and Jones were arrested and made their initial court appearances.

In addition to the conspiracy the indictment charges Fotovich and Jones together in one count of wire fraud, and each was charged with money laundering. In addition, Fotovich is charged with five counts and Jones four counts of filing a false tax return, as they allegedly failed to declare the $388,645 in embezzled income on federal returns.

Fotovich and Jones worked as facility engineers at DST Systems' Winchester Data Center in south Kansas City. When the facility underwent major renovations 2011-16, DST removed copper wire and other metals and redeemed them at a local scrap dealer. According the court documents, Fotovich and Jones handled all but one of 138 scrap redemptions but turned in only 39 receipts totaling $174,910. The total proceeds from scrap metal was $563,556.

Fotovich owned two businesses apart from DST – R&T Heating and Cooling and R&T Mechanical – and Jones did some for work for the latter business, but they declared little of their R&T income on federal tax returns, according to court documents.

The two men requested that the scrap dealer make checks payable to them personally rather than DST, and that redemption tickets be split in order to conceal the total amount of scrap redeemed. Sometimes they received up to four receipts and corresponding checks in one day.

According to court documents, Fotovich and Jones requested that DST buy an industrial wire-stripping machine to improve and expedite scrap metal redemption. The machine cost about $5,000 and was purchased in early 2014, after which the two men's thefts increased more than tenfold. From 2014 to 2016 they embezzled $355,146.

The two men bought vehicles with their illegitimate gains, including a a 2010 Mustang, a 2017 pickup truck and two motorcycles, and paid personal expenses including a home mortgage.

The indictment also contains forfeiture allegations, which would require the men to forfeit to the government any property derived from the proceeds of their alleged crimes, including $388,645, Fotovich's residential property and the car, truck and motorcycles.