Former New York Construction Company Vice President Pleads Guilty in Connection with $19 Million DBE fraud
On October 29, John Athanasiou, former Director of Purchasing for Perini Corporation's Civil Division, pled guilty to money laundering and conspiracy for his role in a Disadvantaged Business Enterprise (DBE) fraud scheme which involved several New York Area roadway improvement projects that received DOT funding.
Mr. Athanasiou admitted that from 1998 to 2001, he conspired with others to obtain transportation construction contracts worth approximately $284 million by using three "pass through" DBEs to obtain various levels of DBE credit, and relied on a number of non-DBE contractors to do the actual work. The "pass through" DBEs generally received between 3% - 5% of the subcontract value as a fee to process payroll and other required paperwork. The DBE owners and others involved in this conspiracy have pled guilty and were prepared to testify for the government in an impending criminal trial. Perini Corporation has paid $9.75 million pursuant to a negotiated civil settlement to resolve its criminal and civil liability in the matter.
This investigation was conducted jointly with members of the Federal Construction Fraud Task Force, whose members include the Internal Revenue Service-CID, Department of Labor Office of Inspector General, and the New York City Department of Investigation.