PaintSquare.com
      | Connect Follow us on Twitter Like us on Facebook
About | Subscribe | Advertise
  

 

Download our FREE eResource: Specifier's Choice Guide. Get it now.

Coatings Industry News

Main News Page


MWBE Contract Scam Ends in Jail Term

Wednesday, April 2, 2014

Comment | More

A 77-year-old Chicago contractor who agreed to use his company as a minority-owned front for companies seeking city contracts will serve 17 months in jail and pay more than a half-million dollars in restitution for the scam.

Jesse Brunt, 77, owner of Brunt Brothers Transfer Inc., was sentenced in mid-March, more than three years after his federal indictment for mail fraud and nearly two years after he pleaded guilty in the case, Chicago's Office of Inspector General (OIG) announced.

Chicago
Wikimedia Commons / DazMSmith

In 2012, the City of Chicago obtained an $11 million settlement from Allied Waste Transportation in connection with related to "substantial shortfalls in minority contract services."

Brunt's trucking company raked in more than $3 million from the City of Chicago between 1999 and 2006 through contracts for services that included cleaning and videotaping sewers.

Brunt's case was part of a long-running fraud case that triggered a citywide Minority- and Women-owned Business Enterprise (MWBE) reform initiative in Chicago in 2012.

Other Settlements

Authorities said Brunt, a former Mississippi sharecropper, used his company as a pass-through for others, including now-defunct companies owned by Anthony Duffy, a non-minority contractor.

Duffy, 49, of Barlett, IL, pleaded guilty in 2012 to lying to the FBI about failing to report investors in one of those companies, Municipal Sewer Service, which performed the work for the deal Brunt had signed.

Duffy was sentenced last year to 17 months in jail. He also agreed to pay $428,438.74 to the city and was permanently banned as a city contractor.

In 2012, the City of Chicago obtained an $11 million civil settlement with Allied Waste Transportation in connection with "substantial shortfalls in minority contract services under waste hauling contracts with the City," the Office of Inspector General reported.

$38M Municipal Fraud

OIG found that "nearly all" of Allied's mandated MBWE participation on city contracts was achieved through Allied's "knowing use" of pass-through contractors. Allied paid off both the certified firms and the contractors that actually completed the work, taking a cut in the process.

MWBE
publicpolicylab.org

Chicago's Office of Inspector General criticized oversight of the city's Minority- and Women-Owned Business Enterprise program and recommended several changes.

In all, OIG said the shortfall from bogus MWBE contracts totaled $38 million over nine contracts.

OIG said it had debarred more than 65 companies and individuals and recommended stripping certification from more than 20 companies since 2005. Five federal criminal prosecutions were also mounted.

In Brunt's case, Allied claimed that Brunt Brothers provided more than $9 million worth of MBE participation that involved 20 to 25 trucks a day. In fact, OIG said, Brunt owned "at most five trucks."

The OIG made a number of recommendations for changing the MWBE system. It noted, for example, that the online monitoring system "relies on the hostesy of Allied's MWBE subcontractors, all of which were participating in the fraud."

   

Tagged categories: Contractors; Enforcement; Government contracts; Laws and litigation

Comment from Michael Deaton, (4/2/2014, 5:22 AM)

Here we go again....Yet MORE corruption coming out of Illinois!


Comment Join the Conversation:

Sign in to our community to add your comments.

SAFE Systems, Inc.
Portable Blast &
Recovery Equipment

Trailer or skid mounted blast and recovery equipment. Systems designed for maximum versatility, environmental compliance
and overall cost savings.
Call 1-800-634-7278


Industrial Vacuum Equipment Corp.
Hurricane Vacuums
& Dust Collectors

Vacuum and dust collector hose, filters and related accessories.
IndustrialVacuum.com


Clemco Industries Corp.
Maximum Dust Suppression Systems Start at $14,950

The system comprises proven technology and equipment with user-friendly flexibility in mind. See it in action.


SSPC: The Society for Protective Coatings
http://www.sspc.org/

Join SSPC and Enhance
Your Career !


PSS Industrial Group
AirTech - World Leader in Custom Spray Solutions

AirTech is the solution
for any custom spray application. We have painting & finishing equipment, blast equipment, painting accessories, booth filter and many more items in inventory.


PreTox Products - NexTec, Inc.
GOT LEAD? Specify Pretox System products

The ONLY Lead Stabilizer Compatible with All Paint Removal Methods. Works with all Blast Media: Grits | Recyclable Abrasives | CO2 | Water | Power Tools | Etc. Call Dave Steffen at 800.338.8296.


Atlantic Design, Inc.
CLICK HERE

to see what we did to this dust collector! ADI can increase the efficiency and life of your equipment! Any brand, for less than new! 866.Call.ADI


W Abrasives
Steel Abrasives from
W Abrasives

As the global leader in steel abrasives, W Abrasives material is the efficient and eco-friendly solution blasting with you to reach the perfect profile.


HoldTight Solutions Inc.
NO FLASH RUST - NO CONTAMINANTS

Our HoldTight®102 salt remover & flash rust
preventer prevents flash
rust by removing surface contaminants. Contact us
for your nearest distributor.
(800) 319.8802 sales@holdtight.com


Clemco International GmbH
Global engineering-trusted solutions

For more than 70 years, Clemco has provided the highest quality blast equipment with a total commitment to comfort and safety.

 
 
 

Technology Publishing Co., 2100 Wharton Street, Suite 310, Pittsburgh PA 15203-1951

TEL 1-412-431-8300  • FAX  1-412-431-5428  •  EMAIL webmaster@paintsquare.com


The Technology Publishing Network

Durability + Design PaintSquare the Journal of Protective Coatings & Linings Paint BidTracker

 
EXPLORE:      JPCL   |   PaintSquare News   |   Interact   |   Buying Guides   |   Webinars   |   Resources   |   Classifieds
REGISTER AND SUBSCRIBE:      Free PaintSquare Registration   |   Subscribe to JPCL   |   Subscribe to PaintSquare News
MORE:      About PaintSquare.com   |   Privacy policy   |   Terms & conditions   |   Site Map   |   Search   |   Contact Us