August 8, 2017
MARAD Suspends New York Contractor and Owner Following Sentencing in USMMA Bribery Case
On August 8, 2017, the Maritime Administration (MARAD) suspended S&M Painting (S&M) and its owner, George Monioudis, from receiving Federal contracts, loans, and other forms of assistance, pending debarment proceedings. This action was taken as a result of Monioudis’ criminal conviction for paying bribes to John McCormick, a former official at the U.S. Merchant Marine Academy (USMMA), in return for the awarding of contracted work. McCormick helped Monioudis obtain contracts by revealing the Independent Government Cost Estimates for proposed jobs. McCormick also collected bogus “covering” bids, many from fictitious companies, to ensure there were sufficient numbers of competing bids for S&M to obtain the contracts. In return, Monioudis made cash payments to McCormick in amounts equal to a percentage of the contract or the resulting profit. Between 1998 and 2014, USMMA awarded S&M approximately 173 paint contracts totaling over $1 million.
The U.S. District Court, Eastern District of New York, sentenced Monioudis on June 30, 2017. McCormick pleaded guilty to related charges on January 20, 2017, and is currently awaiting sentencing.
DOT-OIG conducted this investigation with the Internal Revenue Service’s Criminal Investigation Division.