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Investigations

Date

Massachusetts Company Charged in Connection with Disadvantaged Business Enterprise Fraud

On January 21, 2016, Transit Safety Management, Inc. (TSM), a consulting company in Georgetown, MA, was charged with making a false statement in connection with its certification to maintain its status as a disadvantaged business enterprise (DBE). 

TSM provided consulting services to the railroad industry, focusing on safety and operations management. Shortly after it was founded in 1999, TSM’s owner certified the company as a DBE. As such, TSM was able to take advantage of Federal regulations aimed at promoting the participation of minority and disadvantaged businesses in federally-funded public construction contracts. In order to maintain its DBE certification, TSM had to make yearly affirmations that it was still eligible and that nothing had changed that would affect its eligibility for its DBE status. Despite this, TSM lied about whether it met the criteria for DBE status. According to court documents, TSM’s owner was hired as a full-time employee with a Federal agency in 2005. As a full time Federal employee, TSM’s purported manager could not control TSM in accordance with the DBE regulations. Nevertheless, TSM failed to disclose this change and continued to make its yearly affirmations to maintain is DBE status.

TSM was a certified DBE in several States including Massachusetts, Vermont, New Hampshire, Maine, Connecticut, Rhode Island, Florida, California, Texas, New Jersey, Maryland, Virginia, Pennsylvania, North Carolina, Washington, and the District of Columbia, and has performed work on federally funded contracts throughout the country.

Note: Indictments, informations, and criminal complaints are only accusations by the Government. All defendants are presumed innocent unless and until proven guilty.