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Investigations

Date

Owner of Staten Island-Based Construction Company Pleads Guilty

On March 5, 2012, Madeline Pepe, owner of Staten Island-based MS Construction Corporation (MSC), pled guilty in U.S. District Court, New York City, New York.  Ms. Pepe pled guilty to a three-count information charging conspiracy to commit mail and wire fraud.  Between 1994 and March 2011, Ms. Pepe participated in a conspiracy to use MSC as a front disadvantaged business enterprise (DBE) for non-minority firms Crossboro Contracting Co.; RMD Holdings (d/b/a Nationwide Construction Group); and A.B. Recycling LLC, in order to give the appearance MSC was using DBE contractors.  The fraudulent use of the front DBE company involved participation on various FHWA funded projects and an FAA funded project.  In reality, MSC did not perform a commercially-useful function and the work was performed by non-minority firms.  The amount of the MSC subcontracts involved total approximately $2 million. 

As part of her guilty plea, Ms. Pepe agreed to a money forfeiture provision, the amount to be determined at a later date. 

This case is being worked jointly with the USDOL-OIG, the Port Authority of NY & NJ-OIG, and the New York City Dept. of Investigation.