Pennsylvania Tour Bus Operator Convicted in FTA Grant Fraud Scheme
On November 9, 2015, Robert Else, former President of King Coal Tours, pleaded guilty to wire fraud for his involvement in a Federal Transit Administration (FTA) grant fraud scheme.
Previously on October 20, 2015, an Information was filed in U.S. District Court, Williamsport, Pennsylvania. The fraud involved King Coal Tours submitting inflated annual budgets and false monthly expense reports to the Pennsylvania Department of Transportation (PennDOT) and the FTA to gain financial assistance in providing public transportation via Else’s private bus company.
The FTA provided grant funds through PennDOT to local Pennsylvania communities, including Mount Carmel Borough, in order to develop and maintain public transportation systems. Mount Carmel, through its transportation service agency, the Lower Anthracite Transportation System (LATS), entered into annual contracts with King Coal Tours. King Coal Tours primarily operated as a charter bus business, but they entered into annual cost-plus contracts with Mount Carmel to provide public transportation services to LATS between 1984 and 2012.
Robert Else admitted that he overbilled and submitted false invoices for expenses incurred on buses used in his private tour business, which did not fall under the LATS contract. The investigation specifically revealed that Robert Else and King Coal Tours overbilled for approximately 68,745 gallons of tax-free diesel fuel, inflated invoices for approximately 120 replacement tires, billed parts and labor hours related to the maintenance charter buses, and even illicitly billed for administrative hours for office personnel. The plea agreement indicates restitution will be made in an amount up to $500,000.
We are conducting this investigation with the Federal Bureau of Investigation with assistance from the FTA.