Local Businessman Arrested on Felony Theft and other Charges – Bill Williams

Photo of Charlie Arnold during his KYCA radio show (Facebook)

[Editor’s Note: Prescott eNews declined to publish last week’s press release reporting the arrest of Charles Arnold until police reports were available and we could independently verify the circumstances. The following article has been prepared by an investigative reporter commissioned by Prescott eNews.

The publisher of Prescott eNews is an attorney and a personal acquaintance of Mr. Arnold. He played no role in the preparation of this article.

Prescott eNews cautions readers that an arrest does not establish guilt.  Police reports alleging criminal activity are not themselves evidence or proof of guilt. Not infrequently such reports are incomplete or contain mistakes that require updating and correction.  At this stage of the proceedings,  Mr. Arnold is entitled to the presumption of innocence.]

On February 28th of this year, the Yavapai County Sheriff’s Office referred a case to the Prescott Police for investigation. That was the first sign of a potential conflict or something irregular. The Board of the Prescott Chapter of the Veterans of Foreign Wars (VFW) had discovered what they believed to be fraud committed by the former treasurer Charlie Arnold. The board has identified over $34,000 in missing or misappropriated funds during the time Arnold was the VFW Treasurer. Further accounting revealed that Arnold used the VFW credit card to make $9,643 in unauthorized purchases, according to Prescott Police reports obtained by this reporter.  According to police sources, Arnold also went over budget on a kitchen remodel for the VFW in excess of $32,000 where he was paying himself to complete the remodel. On June 4, Arnold was arrested and booked for fraudulent use of a credit card and felony theft.

The fraudulent use of a credit card with an automatic teller machine is a first-degree misdemeanor in this area but the theft of controlled property with the intent to deprive a person, which was the felony charge, is considered larceny in the third degree. The owner or victim is the Prescott Chapter of Veterans of Foreign Wars.

The interview with the alleged perpetrator was done in the Prescott Police interview room and recorded on tape, by Detective John Hanna Jr. That tape is available for public scrutiny. The Sheriff had got wind of allegations when Harry Oberg, a board member, reported that the VFW had hired an accountant to do an audit after they suspected fraud committed by Arnold. The accounting firm was One Bad Cat Bookkeeping.

An interview with Harry Oberg was audiotaped by phone. Oberg was a former Mayor of Prescott.

Arnold was once considered an upstanding member of the community. One local businessman said a person is innocent until proven guilty. “Charles Arnold is a former Prescott City councilman. He was the Citizen Tax Committee’s councilman of the year. He was President of the Republican Men’s Forum.  For 10 years he had a weekly radio program on KYCA.  I’m keeping an open mind.”

But in recent times, as the manager of the Wheelhouse activity center in Prescott Valley Arnold  showed an inability to balance the budget, falling tens of thousands of dollars in arrears to the town of Prescott Valley from which he was renting the old 60,000 square foot barn formerly used by the county fair, and later leased out for use by Arnold’s activities within the Wheelhouse. The  town of Prescott Valley bought the barn for pennies on the dollar from the defunct fair. The Wheelhouse claims to be providing 11 sports for kids, regional tournaments and adult leagues; 500 children and 125 adults use the facility. Meetings of local groups such as The Oath Keepers have been held there.

Oberg told Detective Hanna that Charlie Arnold is an associate member of the VFW in Prescott, not a full-fledged member. Oberg explained that Arnold was not a veteran of a foreign war but a family member of his was, so that qualified him to be an associate member to have access to the building but not all member benefits. Oberg said that around October of 2024 Arnold offered to get the VFW onto Quickbooks, an electronic bookkeeping program that would update them from the paper ledger system that had been in use for decades.

Oberg stated that Arnold was a well-known local businessman and well liked at the VFW so the board voted to allow Arnold to transfer the bookkeeping. Around the same time Oberg said that the kitchen of the VFW was slated to get a remodel to replace and repair the oven, sink and food prep area. Arnold offered his contracting services to complete the job at a reduced cost because he would use his wholesalers to provide the needed materials and he would provide the labor for the remodel at a reduced price. The VFW board voted to hire Arnold and give him a budget of approximately $20,000 to complete the needed repairs and remodel.

Oberg stated that during the remodel there were a lot of cost overruns and delays in completing the work, but in January 2025 the work was complete enough to reopen the kitchen. Oberg said that the delay caused a number of VFW member complaints and the board started asking Arnold questions about the cost overruns and asked for an accounting of spent funds. Oberg told Hanna that Arnold gave a verbal accounting of what was spent and how no one on the board ever confirmed the statement as Arnold was the only one that could operate Quickbooks.

On March 18, 2025, Hanna interviewed Charlie Arnold regarding the criminal investigation involving the VFW Prescott Chapter.

Detective Hanna informed Arnold that he was not under arrest at the time but the purpose of the interview was to gather facts about financial discrepancies. Arnold explained his involvement with the VFW stating he was not a military veteran but had been associated with VFW since high school through the Sons of American Legion. He became a member of the VFW Auxiliary and eventually took on responsibilities related to the organization’s financial management.

Arnold told the detective that the previous quartermaster had left the financial records in disarray and that he stepped in to help organize and manage them. His role in assisting the VFW included the creation of the Quickbooks account, filing taxes and managing the financial records. The primary focus of Detective Hanna’s interview was on two financial projects – parking lot repairs and the kitchen remodel. Arnold explained that the parking lot project was initially budgeted at $5,000 but went slightly over budget due to unforeseen issues with materials. Arnold’s company, Sun West Homes, provided equipment and labor for the project. Sun West was the main management team for the Wheelhouse in Prescott Valley.

Regarding the kitchen remodel Arnold stated that the original budget was $30,000 but he and another member, “Clyde,” proposed a reduced budget of $15,000. The project involved extensive work including demolition, installation of new countertops, shelving, gas stove, three compartments, sink and epoxy flooring.

Arnold told Hanna that the project faced supply chain challenges and some equipment arrived damaged causing delays. Arnold acknowledged that there were overpayments and incorrect charges associated with the remodel. He identified specific transactions that were processed twice and mentioned that they had already started discussions with the VFW to audit the accounts and issue refunds where necessary.

Detective Hanna reviewed financial records during the interview. Those VFW records included several questionable transactions as far as Hanna was concerned. These transactions included charges to APS, the utility company, for a power upgrade and multiple charges to the town of Prescott Valley for permits which were not related to the VFW, but to Arnold’s other business, the Wheelhouse. Arnold admitted that these charges were mistakes and should not have been refunded. Arnold explained he often conducted personal work while at the VFW and may have accidentally used the wrong card for transactions. He claims these were not intentional misappropriations of funds.

Detective Hanna requested that Arnold provide all relevant financial documentation including receipts and bank records to support claims and clarify any questionable transactions. Arnold agreed to gather the necessary documents and provide them by March 30 of 2025. He also said some receipts were stored in his toolbox at the VFW. Detective Hanna offered to accompany him to the VFW to collect the receipts to ensure transparency and accountability. Throughout Detective Henna’s interview Arnold expressed a desire to resolve the financial discrepancies with the VFW and emphasized a commitment to transparency and accountability.

He acknowledged the need for a thorough audit and was cooperative in providing necessary documentation, according to Hanna.

Hanna made several appointments where Arnold agreed to come in with his bank records for the past three years but Arnold broke those appointments due to medical issues and did not provide any bank records to the detective as agreed to.

In early April the detective obtained grand jury subpoenas through the Coconino County Attorney’s office for bank records involving accounts of Charlie Arnold and Sun West Homes. The detective received a return on those subpoenas in early May. Going through the last three years of bank statements on three accounts, the detective says it showed that Arnold was bouncing multiple checks per week in multiple accounts in 2023, 2024, and in parts of 2025.

Per the financial documents provided by the VFW, the detective was able to locate 14 instances of Arnold using the VFW card to pay personal expenses such as APS electric bills for the Wheelhouse, in line hockey association tournament fees for the Wheelhouse, and payments to the town of Prescott Valley all totaling $9,643. Oberg confirmed that none of these charges were related to the VFW or authorized by the VFW board. Further evidence of additional fraud and fraud schemes is still being reviewed.

On June 4, 2025, Arnold went to the Prescott Police station to be interviewed by Detective Hanna. When they entered the interrogation room, Mr. Arnold could have noticed that the detective had set out print outs of bank statements on the table. At that time Hanna advised Arnold of his Miranda warnings which he waved by saying he understood.

Arnold asked if he was under arrest or if he was detained. And the detective advised Arnold that he was detained and that he wanted to go over specific transactions of the VFW debit card and personal bank records from the same time. Arnold stated that he thought it was best to wait to answer those questions until he could speak to a lawyer so the detective said he wouldn’t ask any more questions about the case but that Arnold was now under arrest based on the information obtained. The detective electronically booked Arnold and he was transported to Yavapai County’s Prescott jail by another officer.

Arnold was booked on 14 charges of fraudulent use of a credit card and felony theft. The case was referred to Coconino County due to a conflict of interest of the Yavapai County Attorney’s office prior to the arrest of Arnold, according to one police officer, and two news organizations, but now that information is suspect. One clerk of the Yavapai County Courthouse, Shannon Shoemake, held back laughter when interviewed by this reporter, saying, “No, that’s our case.” And that she had no information that the case was given to Coconino County. As reported earlier, Detective Hanna was quoted as saying he “obtained grand jury subpoenas through the Coconino County Attorney’s office.” This reporter’s calls to that office remain unanswered.

But Shoemake and other clerks were told to not give out any information on the case, including basic questions asked by this reporter such as: If Arnold was taken to the jail in Prescott, how was bond arranged and paid, or was he released on own recognizance; was there a notice of hearing that might contain an attorney’s name? Ms. Shoemake said there is no information that has been made public yet, it is restricted because “we don’t know if he was served process, or if he was ever seen by a judge.” She also implied she had looked at the jail website and found nothing. But legal scholars agree that once you are booked, the docket process begins.

After this reporter consulted with the Prescott eNews publisher (who is an attorney), we decided something is irregular in how this case is being handled, and to contact the presiding judge of the court, the honorable John Napper. His assistant paused the phone call for a few minutes and then recommended this reporter contact Court Administrator Julie Malinowski. This reporter left three messages with Malinowski regarding basic information sought, yet she failed to return phone calls.

Shoemake did say Arnold is supposed to attend an EDC hearing in the county’s Camp Verde court today. An EDC hearing is an early disposition court hearing where plea bargains are often made.

Regarding the arrearage owed to the town of Prescott Valley, the town manager of Prescott Valley, Gilbert Davidson, was asked 1. Have the Wheelhouse finances been audited? 2. Who will be our point person for payments from the Wheelhouse? 3. If there was an audit, where can one obtain the report. 4. If one was not done, what is the reason? 5. What is the current debt owed to the town by Wheelhouse? 6. What is the most current payment made by Wheelhouse to the Town? Davidson has not responded to the questions.