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Owner Pleads Guilty in Bid-Rigging

Wednesday, November 20, 2013

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With his bribery attempts caught on video by a project manager, the former owner of a New Jersey heavy construction and paving company is now looking at 20 years in prison for bid-rigging.

George Chrysanthopoulos, 50, the former owner of Tarheel Enterprises Inc., pleaded guilty in mid-trial to a scheme to defraud a private terminal operator at Port Elizabeth, NJ, U.S. Attorney Paul J. Fishman announced Nov. 14.

That episode was part of a 10-year pattern of bribery that netted the contractor $17 million, prosecutors said.

Chrysanthopoulos entered his plea before U.S. District Judge Joel A. Pisano in Trenton, NJ. Under the plea agreement, the remaining six counts of the indictment are to be dismissed at sentencing, which is scheduled for March 26, 2014.

Chrysanthopoulos, who was released on bond, faces a maximum prison term of 20 years and a maximum fine of $250,000.

'I'll Be Happy, Man'

The scheme played out between February and April 2011, court documents say.

Chrysanthopoulos offered to bribe Donald Olesky, then director of facilities maintenance at Maher Terminals LLC, in exchange for his help in rigging the terminal operator's bid process for a $3 million construction project in favor of Tarheel, based in South Amboy, NJ.

Chrysanthopoulos guilty plea
Tarheel Enterprises

The former owner of Tarheel Enterprises, a construction company, pleaded guilty to offering bribes and kickbacks to a terminal operator at Port Elizabeth, NJ.

Chrysanthopoulos and Olesky also discussed steering $150 million in additional Maher construction projects to Tarheel. In exchange for his help, Olesky told Chrysanthopoulos, "we could do the same thing like we did last time, George ... like for every $5 million, I get 20 grand, boom, ... I'll be happy, man," court documents state.

Chrysanthopoulos did not know that Olesky, a convicted felon, was cooperating with law enforcement and recording several of their incriminating meetings.

Chrysanthopoulos gave Olesky a list of contractors to invite to bid on the project and promised Olesky $50,000 to rig the bidding process in favor of Tarheel.

Chrysanthopoulos then said he would call the contractors on the list before bidding, tell them to "back off" and tell them to submit bids that were higher than Tarheel's.

Olesky's History of Bribery

Olesky pleaded guilty in November 2011 before U.S. District Judge Freda L. Wolfson in Trenton to two counts of the use of mail and facilities in interstate commerce to promote commercial bribery.

According to the FBI, Olesky accepted multiple kickbacks, including:

  • $50,000 from 2000 to 2007 from a demolition contractor;
  • $22,000 in 2007 from a demolition contractor;
  • $50,000 from 2000 to 2011 from a general contractor; and
  • $13,500 from 2010 to 2011 from a general contractor.

Olesky will be sentenced at a later date.

Decade of Bribes

While Chrysanthopoulus pleaded guilty to a 2011 incident, the indictment alleges a pattern of bribery dating to 2002.

In one instance, the indictment says, Chrysanthopoulos paid an engineer for the New Jersey Department of Transportation $1,000 a week (about $48,000 from 2006 to 2008) for his "official influence and assistance" with a project Tarheel was awarded in 2005.

Maher Terminals
Maher Terminals LLC

As part of the scheme, Chrysanthopoulos allegedly paid a project manager at Maher Terminals $50,000 to help him win a bid for a $3 million construction project.

The other counts in the indictment were:

  • Mail fraud conspiracy;
  • Use of the mail and facilities in interstate commerce to promote, carry on and facilitate commercial bribery;
  • Scheme to defraud the terminal operator of the employee's honest services by defendant giving concealed bribes and kickbacks to the employee;
  • Use of facilities in interstate commerce to promote, carry on and facilitate commercial bribery (two counts); and
  • Corruptly giving, offering, and agreeing to give things of value to influence and reward.

According to court documents, Chrysanthopoulos raked in about $17 million over the years from the schemes, which the indictment sought to forfeit.

If convicted on all seven counts, Chrysanthopoulos would have faced up to 85 years in prison and $1.75 million in fines.

   

Tagged categories: Bidding; Construction; Contractors; Ethics; Laws and litigation; Shipyards

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