The Haysi Town Council requested the Virginia State Police investigation that led to fraud and embezzlement charges against the mayor after months of questioning his spending and tightening the town’s finances, according to meeting minutes and the vice mayor.
The Virginia State Police arrested Larry Yates, 72, Sept. 17 on eight fraud and embezzlement charges. He is scheduled to appear in Dickenson County Circuit Court in Clintwood on Monday for a hearing to discuss his attorney and determine a court date.
The town has about 500 residents who live along the Russell Fork River in Dickenson County. In the past year, the mayor began behaving differently than the active, well-spoken and helpful leader he had long been, Vice Mayor Debbie Wood said in an interview.
Wood said Yates became confrontational about financial topics and was less active in the day-to-day operations of the town. Minutes from town council meetings since November show repeated questioning of the mayor’s mileage reimbursements, advances to his monthly pay and spending on town credit cards. The town council placed restrictions on his credit card purchasing, town vehicle use, advances and any officials’ signing of checks to themselves, and has required council approval for all nonessential spending since March.
Wood, who became vice mayor in July and has served on the council since 2023, said she could not speak in detail about the case because the investigation is ongoing. The council initiated a conversation with the state police at the beginning of this year, she said, and has been in a holding pattern as the state investigated.
Because Yates is an elected official, Virginia code states that the investigation must go through the governor, attorney general or a grand jury. Yates was indicted by a county grand jury earlier this month.
Wood said waiting for the process to play out was frustrating. After the news broke in Haysi, Wood said she’s seen both support and speculation from residents about the council’s involvement leading up to the charges.
“We knew our community was watching circumstances unfold, so we wanted to scream out, ‘Hey, this isn’t us. This is an individual, and we are doing everything we can on our end to put a stop to it,’” Wood said.
The vice mayor said the town council cooperated with law enforcement since initiating the investigation and worked with an auditor to review finances and receive guidance going forward. According to minutes, the auditor visited in June and recommended that the town enforce multi-person approvals of transactions and other financial monitoring procedures. Yates was absent from that meeting, and conversations continued in the July meeting about how best to protect the town going forward.
The felony charges against Yates are embezzlement, use of public assets for personal benefit, credit card fraud, receiving goods obtained through credit card fraud and two counts of credit card theft.
Those charges might be “small potatoes” in the grand scheme of local government finances, Wood said.
“But for a tiny little town, it’s definitely a roadblock to transparency and success and public trust,” she said.
There has been a series of intense town meetings over the year, she said, and minutes reveal a heated discussion in April, when Yates said the new restrictions were shutting down town business, while council members said they would approve spending that was important for town operations.
Yates was asked to resign by the council and refused multiple times since January, Wood said, though the meeting minutes reflect one mention of it in June by council member Tim Wallace. Yates has not resigned since his arrest, she said.
On Tuesday night, the town held an emergency meeting to update the financial accounts and discuss further action, including requesting Yates’ voluntary resignation. If he declines to resign, Wood said council plans to invoke Section 8 of the town’s charter, which states that a member can be expelled for “good cause.” Wood said the council waited to move forward with this until the charges became public record.
The expulsion would involve petitioning the Dickenson County Circuit Court for his removal, Wood said. It’s too early to talk about who would fill the seat, she said, but she said she will lead as needed until a permanent replacement is determined.
“There was nobody dissenting from the fact that the investigation had to happen and that currently the resignation needs to happen,” she said of the council.
On Sept. 21, Yates appeared on video for a court hearing, but both the Tazewell County commonwealth’s attorney and his attorney were not present, and it was postponed. Yates said at the hearing that he made arrangements for legal representation by Nick Compton, an attorney with Mitchell Kilgore out of Lebanon, but Compton said he is not involved and declined further comment.
Once he secures legal counsel, a bond agreement can be made between the prosecutor and Yates’ attorney. Yates remains in the Southwest Virginia Regional Jail Authority’s Abingdon facility.
Yates served on the county’s industrial development authority and recently resigned, according to Dickenson County Administrator Larry Barton. Barton and Dana Cronkhite, the county’s industrial development authority director, both declined to comment.
Amanda Perrigan, the town clerk, and Amanda Mullins, the town attorney, both deferred to Wood for comment on behalf of the town. Wood said she speaks on behalf of the town council, which has six members, on this matter.
Yates was elected in 2008 and has served in the seat since. Residents said he is from Haysi, and it’s unclear what jobs he worked other than mayor.
Around town, several residents said they had noticed a difference in the mayor. Jason Deel, the owner of Haysi Supply Co., a general store downtown, said Yates was very active in town and worked with Spearhead Trails, a network of ATV trails through Southwest Virginia, and Breaks Interstate Park, known as the Grand Canyon of the South.
Deel said he noticed changes in Yates’ appearance in the past year when he would stop in the store and work across the street at the old municipal building.
“He made a lot of things happen in town, but I just don’t know what happened, almost like a teenager in the wrong crowd or something,” Deel said. “We were seeing him slip away on a daily basis, but folks outside [town] didn’t see that as clearly as we did.”
Going forward, financial safeguards will remain in place, including council approval for nonessential purchases. Wood said she sees this time as a pivotal point for the town.
“It’s so sad that his legacy could have been this beautiful trail center, these projects for our town, projects he assisted with through the IDA. … it truly breaks my heart that now this will be his legacy,” Wood said.
“It was hard. It was challenging and very uncomfortable,” she said of the past several months, adding that Yates has been her neighbor for 30 years. “When you are on committees like this in small towns, with your neighbors … that is difficult. I hope that our town knows that we, the remaining people on this council, are so committed to making sure that it’s right going forward.”
