Investigations

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New York Attorney Pleads to Fraud and Obstruction Charges for Participating in a Prevailing Wage Benefits Scheme

On March 20, Steven Coren, a New York attorney, pleaded guilty, in U.S. District Court, Brooklyn, New York, to a sixteen–count indictment charging him with scheming to defraud government agencies in connection with his clients’ construction contracts with those agencies; conspiring to launder the funds wrongfully obtained from those agencies; and obstructing the federal grand jury investigation by directing one of his clients to destroy documents related to the scheme. From 2000 through 2006, Mr. Coren and several of his client–contractors defrauded government agencies by falsely representing that the contractors’ workers were being paid the prevailing wage as required by the federal Davis–Bacon Act and New York State Labor Law. A sentencing date has not been set yet.

Mr. Coren executed the scheme by creating a trust fund into which his clients would deposit the fringe benefit portion of employees’ wages and allow them to use those funds for other purposes. This fraud scheme impacted several New York area public works projects including the Metropolitan Transportation Authority’s MetroNorth Railroad Larchmont Station project which received funding from several Federal Transit Administration grants. Our investigation continues and is a joint effort with the Internal Revenue Service and the Department of Labor Office of Inspector General.