Investigations

On January 27, 2017, FTA debarred Larry W. Davis and his company, DCM Erectors, for a period of 3 years after his conviction in an FTA-funded grant fraud scheme that violated the Port Authority of New York and New Jersey’s Minority and Women Business Enterprise (M/WBE) Program on the World Trade Center Transportation Hub project. In August 2016, after an 8-day jury trial, Davis and his company were convicted of wire fraud and conspiracy charges.

 

DCM specialized in steel erection for large construction projects. In 2007, the company was awarded a $256 million contract for work on the One World Trade Center project, and in 2009, it was awarded a $330 million contract. DCM was to supply and erect structural steel and install metal decking as well as provide drafting, engineering, and survey work. FTA provided approximately $2.2 billion in grant funds in support of the projects. The FTA-regulated contracts obligated Davis and DCM to meet certain required minimums of minority- and woman-owned business participation.

 

The jury found that Davis and DCM not only failed to meet these requirements, they took significant steps to conceal their fraudulent activity. DCM claimed, through certifications, that certain work was performed by minority-owned businesses, including Solera/DCM Joint Venture LLC and GLS Enterprises, Inc. (GLS). In fact, DCM itself did the designated work or arranged for it to be performed by other non-M/WBE contractors.

 

In addition, the investigation determined that to facilitate the scheme, DCM paid Johnny Garcia, a Solera/DCM official, approximately $2 million. Gale D’Aloia, owner and president of GLS, had been a longtime DCM employee who performed payroll management services for DCM and Davis’ related companies. In 2004, D’Aloia left DCM but continued to perform the same services for that company through GLS, which she registered as a WBE with the Port Authority. As compensation for engaging in the fraudulent scheme, Davis paid GLS up to 10 percent of each week’s total gross payroll for the surveyors, which totaled hundreds of thousands of dollars. Both Garcia and D’Aloia previously pleaded guilty to criminal charges.

 

DOT-OIG conducted this investigation with the Department of Labor-OIG, IRS-CID, and the Port Authority of NY/NJ-OIG.