Fraud Friday: A Chemical Plant Explosion Exposes $24 Million Loan Fraud

August 21, 2026

Bob Coleman
Founder & Publisher

Fraud Friday: A Chemical Plant Explosion Exposes $24 Million Loan Fraud

At 8:17 a.m. on November 8, 2023, an explosion and fire ripped through Sound Resource Solutions in Shepherd, Texas.

Investigators later said an electrical fire on a forklift ignited a spilled chemical. The flames spread quickly and engulfed the chemical blending facility.

The Texas Commission on Environmental Quality later reported that the plant had 6.62 million pounds of chemicals on site and that the fire consumed the majority of them. Local television crews filmed towering flames and a massive column of black smoke drifting north for miles.

More than 20 fire departments responded. Firefighters and HAZMAT crews came from four counties. Crews poured water and firefighting foam into the plant for hours while U.S. 59 was shut down and traffic backed up into neighboring communities.

Residents were ordered to shelter in place, close their windows and turn off their HVAC systems because officials did not yet know exactly what was in the smoke. Thirty homes and two schools were evacuated.

At nearby Wildwood Academy, students and staff escaped by cutting through a pasture to reach another road where they could be picked up.

The fire was bad enough.

But for the bank that had financed Thomas Mwangi’s purchase of the plant nine months earlier, there was another problem.

The $17 million business acquisition loan was secured with a Schwab account that prosecutors now say was fiction.

Thomas Mwangi, a Georgia businessman, owned CAMaster, a CNC router manufacturer in Cartersville. In late 2022, he approached First Financial Bank to finance his purchase of Sound Resource Solutions.

The bank agreed to lend $17 million, provided Mwangi pledged $3 million in collateral.

He pledged his Charles Schwab investment account.

On February 27, 2023, prosecutors say Mwangi emailed the bank a statement showing more than $10 million in the account.

More than $10 million on the statement.

Less than $2 million in the account.

The bank also required Schwab to acknowledge its security interest in the account. Prosecutors say Mwangi delivered an agreement bearing the signature of a Schwab representative.

The signature was forged say the Feds.

First Financial funded the loan.

Then Mwangi kept sending monthly Schwab statements. Prosecutors say those were false too.

Sixteen days after the fire, First Financial Bank issued Mwangi a commitment letter for another $7 million acquisition loan.

The second deal was already in the works before the explosion. In September, Mwangi had approached the bank to finance his purchase of R&F Industries and submitted a personal financial statement claiming his Schwab account held $14,179,077.

By then, First Financial had put $24 million into two acquisitions supported in part by the same brokerage account.

And the balance in that account was not remotely what the bank had been told says the indictment. 

“Mwangi allegedly conned a bank out of approximately $24 million by forging signatures and fabricating account statements,” says U.S. Attorney Theodore S. Hertzberg.

Mwangi was arraigned on August 10th and is free on a $10,000 unsecured bond.