|
Company Convicted of Fraud and
False Statements Scheme on Big Dig Contract
BOSTON, MA—A company doing work on a Big Dig contract pled guilty today in
federal court with submitting false claims on a federal highway project. The scheme involved
the systematic, fraudulent billing of apprentice workers at the higher rate of pay for journeymen,
resulting in continuing overpayments by the Central Artery/Tunnel (CA/T) project to the
contractor. In addition, the scheme also involved fraud against the U.S. Department of
Transportation’s Disadvantaged Business Enterprise (DBE) program.
Acting United States Attorney Michael K. Loucks, Theodore L. Doherty III, Special
Agent in Charge of the Department of Transportation Inspector General’s Office in New
England, and Marjorie Franzman, United States Department of Labor, Office of Inspector
General, Office of Labor Racketeering and Fraud Investigations and Warren T. Bamford, Special
Agent-in-Charge of the Federal Bureau of Investigation - Boston Division announced today that
ADAMS MANAGEMENT GROUP, INC. (AMG) pled guilty to a single-count Information
with conspiracy to defraud the United States with respect to claims on a federal highway project.
At the plea hearing, the prosecutor stated that, beginning in 2002 through 2006, AMG, a
subcontractor to MCCOURT CONSTRUCTION CO., engaged in a scheme to over-bill the
Central Artery/Tunnel Project by falsely categorizing apprentice workers as journeymen on work
performed on the C17AA Tunnel Finishes Contract. The work, which was overbilled, was
performed on a time and materials basis, which meant the subcontractor was paid for the time
worked by each employee, as opposed to a fixed price for the work under contract. In addition,
AMG obstructed the Department of Transportation’s DBE program since AMG was the
minority subcontractor, but the work was substantially performed by ISLAND LATH AND
PLASTER, INC., a company which has been convicted previously of the same scheme and
which also prepared the bills submitted by AMG to the CA/T project.
AMG faces a fine of up to $500,000 and a term of probation of up to five years, as well
as a mandatory $400 special assessment. U.S. District Court Judge Patti B. Saris set the
sentencing for September 14, 2009 at 2:00 p.m.
MCCOURT CONSTRUCTION and two of its managers have previously been convicted
in federal court regarding the same overbilling scheme. In addition, three individuals employed
by Massachusetts Electric Construction Company also, a MCCOURT CONSTRUCTION
subcontractor on the tunnel finishes contract, have previously been convicted in federal court for
submitting false claims in connection with overbilling apprentice labor at journeyman rates.
The case was investigated by the Department of Transportation, Inspector General’s
Office, the Department of Labor/Office of Labor Racketeering, and the Federal Bureau of
Investigation, New England Field Division. It is being prosecuted by Assistant U.S. Attorney
Eugenia M. Carris of Loucks’ Public Corruption Unit. Press Releases | Boston Home
|
