Massachusetts Construction Company and Owner Pleads Guilty To Fraud Related Charges
On September 4, 2013, in U.S. District Court, Boston, Massachusetts, Juan J. Alonso and Aguila Construction Company, Inc., of Fitchburg, Massachusetts, pleaded guilty to fraud related charges. Alonso operated Alonso Construction, Inc. and Aguila Construction Company from the same location. The companies performed the same type of work, used the same equipment, and used the same laborers and office staff. This "double-breasted" arrangement is often used in the construction industry to avoid paying union members the union wages and benefits.
Between 2008 and 2011, Aguila Construction secured several publicly-funded projects, including 12 projects funded by the DOT pursuant to the American Recovery and Reinvestment Act of 2009. During this time and while performing work on Federally funded construction projects, Alonso and Aguila Construction defrauded benefit funds by running part of the Aguila Construction payroll through Alonso's "non-union" company, Alonso Construction, thereby underreporting the hours actually worked by Local 39 members. Alonso also defrauded the funds by paying Aguila Construction laborers in cash, in order to avoid making hourly payments to the benefit funds. Over the four-year period, the defendants failed to pay approximately $805,338 owed to the funds.
We conducted this investigation jointly with the U.S. Department of Labor, Office of Inspector General, Office of Labor Racketeering and Fraud Investigations; and Employee Benefits Security Administration.