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

 

Download our free Wastewater Treatment Coating Systems eResource Book

Paint and Coatings Industry News

Main News Page


Transit Venture to Pay $4.6M in Fraud

Friday, August 26, 2011

More items for Program/Project Management

Comment | More

A group of transit contractors and subcontractors will pay a $4.6 million fine for allegedly misrepresenting minority participation on a federally funded light-rail project in Minneapolis.

At the same time, however, the joint venture Minnesota Transit Constructors Inc. (MnTC) and its subcontractors expressly deny the allegations, under the settlement with the U.S. Department of Justice.

 Hiawatha Corridor Light Rail Project under construction

 Photos: Minnesota DOT

Disadvantaged Business Enterprises involved in the rail project (shown under construction in 2002) “were merely extra participants used to make it appear as if” they had performed the work,” the Justice Department said.

“We categorically deny any wrongdoing,” said Jacque Fourchy, spokeswoman for Watsonville, CA-based Granite Construction, which led the JV and will pay $1.1 million of the settlement. Granite had the majority interest in the project.

$330M Light Rail Project

The MnTC joint-venture team was the design/build contractor on the 12-mile, $330 million Hiawatha Corridor Light Rail Project for the Minnesota Department of Transportation. The line connected the downtown Minneapolis-St. Paul Airport with the Mall of America.

The venture also included Granite’s construction partner C.S. McCrossan Inc., of Maple Grove, MN; and a joint venture of Parsons Transportation Group, based in Pasadena, CA, and Edwards and Kelcey Inc., an engineering group acquired in 2007 by Jacobs Engineering Group. McCrossan also owns Midwest Pipe & Rebar Coating.

Allegations Disputed

“The claims asserted by MnDOT and the DOJ over the course of this five-year investigation are disappointing, and any inferences that we made misrepresentations in connection with this project are incorrect,” said James H. Roberts, Granite’s president and CEO.

“We disagree with the allegations; however, we felt it was in our best interest to settle the issue and avoid the expense and the distraction of litigation. While some settlements are accompanied by an admission of wrongdoing, notably, this one was not.”

The other companies issued no statements on the settlement.

The Justice Department alleges that the companies “falsely claimed that they had used Disadvantaged Business Enterprises (DBEs) for part of the work on the project when they had not.” The DBE program helps businesses owned by minorities and women work on federal construction projects.

To obtain and maintain their contract on the Hiawatha project, MnTC and its subcontractors were required to comply with the DBE regulations and to accurately report their DBE contracting.

‘Merely Extra Participants’

“MnTC claimed that materials and services for the project were provided by DBEs, when in fact, they were provided by non-DBE subcontractors and the DBEs were merely extra participants used to make it appear as if a DBE had performed the work,” the Justice Department said in a statement. 
 
“When businesses misrepresent those working with them to obtain government contracts, they violate the law and economically harm subcontractors who already face numerous disadvantages in the workplace,” said B. Todd Jones, U.S. Attorney for the District of Minnesota. “This resolution helps to correct that injustice in this instance.”

 Hiawatha Corridor Light Rail Line
The Hiawatha Corridor Light Rail Line carries about 10 million riders per year.

The government’s claims were based upon an investigation conducted by the Justice Department’s Civil Division, the U.S. Attorney’s Office for the District of Minnesota, DOT’s Office of Inspector General, and the Federal Transit Administration.

The Justice Department’s total recoveries in False Claims Act cases since January 2009 have topped $7.5 billion.

“Disadvantaged Business Enterprise (DBE) fraud harms the integrity of the DBE program and law-abiding contractors, including many small businesses, by defeating efforts to ensure a level playing field in which all firms can compete fairly for contracts,” said Michelle McVicker, regional Special Agent-in-Charge of the DOT’s Office of Inspector General.

McVicker said authorities would continue to work “expose and shut down DBE fraud schemes that adversely affect public trust and DOT-funded transit programs throughout Minnesota and elsewhere.”

   

Tagged categories: Government contracts; Lawsuits; Mass transit; Rebar; Subcontractors

Comment from Car F., (8/29/2011, 10:47 AM)

Another normal day of corruption, bribery and chicanery. This is probably [I have no empirical evidence] more the rule rather than the exeption: honest contarctors who follow the rules ALWAYS end last.


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


Clemco Industries Corp.
Powerful Protection in a Small Package

Mounts inside blast helmet, alerts operator to dangerous breathing-air condition by audible, visual, and vibratory alarms. Easily calibrated, battery operated.


Atlantic Design, Inc.
OUR INDUSTRY IS CHANGING!

We should know. We’re the ones leading the way. Cleverly simple. Clearly ADI. 866.Call.ADI


Advanced Recycling Systems
ADVANCED RECYCLING SYSTEMS (ARS)

Recycling Machines, Dust Collectors, Rapid Deployment units are time-tested and approved for the rugged industrial environment. Contact ARS today!
(330)536-8210


Abrasives Inc.
Check our Prices for Blast Abrasives

Faced with higher abrasive costs? We invite you to call & check our rates on Black Magic® coal slag and other quality blast materials. Abrasives Inc. 800-584-7524


Polyval Coatings
Polyflex® Polyurea Linings

Polyflex ™ new Polyurea Geotextile Membrane System has been specifically engineered to protect the environment in containment applications.
www.polyflexlinings.com


U.S. Zinc
Historic Reliability. Innovative Performance.

As an industry leader with an established global footprint, we provide the products that prolong the life your paints and coatings. U.S. Zinc – Helping the world work™

 
 
 
Technology Publishing

The Technology Publishing Network

The Journal of Protective Coatings & Linings (JPCL) PaintSquare
Durability + Design 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
 

© Copyright 2000-2015, Technology Publishing / PaintSquare, All rights reserved
2100 Wharton Street, Suite 310, Pittsburgh PA 15203-1951; Tel 1-412-431-8300; Fax 1-412-431-5428; E-mail webmaster@paintsquare.com