New York State Contractors Pay over $1 Million to Settle DBE Fraud Allegations
On February 1, 2016, ING Civil, Inc. and its owner, Corey Ingerson; James Beaudoin, former owner of Rexford Albany Municipal Supply Company, Inc. (RAMSCO); and former RAMSCO salesman John Leary agreed to pay $1,012,000 to resolve Disadvantaged Business Enterprise (DBE) contract fraud allegations that they collaborated with a DBE to submit false filings to the government in violation of the False Claims Act. The allocations of civil payments are as follows: Ingerson and ING will pay $437,000; Beaudoin will pay $550,000; and Leary will pay $25,000.
In 2009, Ingerson and Leary agreed to an illegal pass-through scheme in connection with the Bridge Avenue Bridge Reconstruction Project (BABRP), in Cohoes, NY. This project is valued at over $6.3 million and funded by the American Recovery and Reinvestment Act. The arrangement was that RAMSCO, a non-DBE, would provide the materials and bill prime contractor ING Civil through now-defunct DBE American Indian Builders & Suppliers, Inc. (AIB). In furtherance of the scheme, Ingerson signed a DBE Utilization Worksheet representing that AIB would supply $306,285 worth of materials for the project, although he knew virtually nothing about AIB nor had any substantive discussions with anyone from AIB about the materials required. Ingerson instead dealt directly with RAMSCO officials.
In the settlement agreement, Ingerson admitted that he made a false filing indicating that materials for the BABRP were supplied by AIB when, at the time he made that filing, he knew the materials were provided by RAMSCO. RAMSCO officials, Beaudoin and Leary, admitted in their settlement agreements that they took steps to aid ING Civil in making that false filing.
We are working this case jointly with the Federal Bureau of Investigation, the U.S. Environmental Protection Agency's Office of Inspector General, and the New York State Department of Transportation's Investigations Bureau.