Father and Son Plead Guilty to Federal Charges in Investigation Involving D.C. Taxicab Industry |
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U.S. Attorney’s Office, District of Columbia
April 16, 2014
Admit Acting Illegally in Attempts to Generate Business
WASHINGTON—Anthony C. Y. Cheng, Sr. and his son, Anthony R. Cheng, Jr., pled guilty today to federal charges stemming from an undercover investigation into a scheme to illegally generate business through the District of Columbia taxicab industry, announced U.S. Attorney Ronald C. Machen, Jr. and Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office.
Anthony Cheng, Sr., 65, and his son, 40, both of Alexandria, Virginia, pled guilty in the U.S. District Court for the District of Columbia. Anthony Cheng, Sr. pled guilty to a misdemeanor charge of making an offer of unauthorized compensation to a public official. Anthony Cheng, Jr. pled guilty to a felony charge of payment of a gratuity to a public official.
The Honorable Ellen S. Huvelle scheduled sentencing for July 17, 2014. Anthony Cheng, Sr. faces a statutory maximum of a year in prison and financial penalties. Anthony Cheng, Jr. faces a statutory maximum of two years of incarceration and financial penalties. Under federal sentencing guidelines, the Chengs face up to six months in jail and fines of up to $5,000.
According to plea documents filed today, Anthony Cheng, Sr. is the owner of businesses, including Tony Cheng’s Mongolian Restaurant, in the Chinatown area of Washington, D.C. His son owned a bus company that provided interstate transportation to the public.
The charges involve the Chengs’ dealings in 2010 and 2011 with a person described in the court documents as public official number one who at the time chaired the District of Columbia Taxicab Commission. Unbeknownst to the Chengs, public official number one was working in cooperation with the FBI on an investigation.
“With today’s guilty pleas, a financially successful father and son confessed to their efforts to pay off public officials to advance their business interests,” said U.S. Attorney Machen. “The Chengs should be commended for owning up to their crimes before trial, but their admissions are a sobering reminder that we must continue to aggressively fight the pay-to-play culture that, if left unchecked, can determine who has the ability to engage in business opportunities with the government. We hope that these convictions serve as a warning to other business owners who are tempted to make illicit payments to public officials in order to get ahead.”
“The integrity of our government is threatened when individuals engage in pay-to-play schemes with public officials,” said Assistant Director Parlave. “The FBI is committed to investigating corrupt backroom deals that work to influence government officials and restoring an even marketplace for honest business owners who do business in our city.”
The D.C. Taxicab Commission, an agency within the District of Columbia government, has authority for intrastate regulation of the taxicab industry. Among its many responsibilities, the taxicab commission handles the licensing of owners, operators, companies, associations, and fleets. The agency also employs inspectors who are deployed to prevent illegal taxicab operations within the District of Columbia. If inspectors identify taxicabs that are operating unlawfully, they can have the vehicles towed and impounded.
According to today’s court filings, Anthony Cheng, Sr. decided in or about the fall of 2010 to start a towing company in the District of Columbia. In order to do so, he was required to have a license for a locked storage facility, a towing license, and insurance. On or about December 18, 2010, Anthony Cheng, Sr. met with public official number one at Cheng’s restaurant. At that time, he offered public official number one compensation of 10 percent of the profits of his towing company in return for assistance in completing the paperwork associated with establishing the business and assisting the company in securing towing assignments from the taxicab commission. In a follow-up meeting on January 12, 2011, also at the restaurant, Anthony Cheng, Sr. again requested the assistance of public official number one, including the securing of at least 100 towing assignments per month from the taxicab commission.
Also in 2011, according to the court documents, both of the Chengs met with public official number one regarding licenses for multi-vehicle taxicab companies. At the time, a legislatively mandated moratorium was in place prohibiting the issuance of any new business licenses to operate new taxicab companies, taxicab associations, and limousine businesses.
The Chengs and public official number one discussed a plan to circumvent the moratorium by using falsified backdated corporate documents representing that their taxicab companies had been in existence since 2009. Public official number one advised Anthony Cheng, Jr. of the need to make a “contribution” of not more than $1,500 for his help with the backdated paperwork. On or about January 31, 2011, public official number one provided Anthony Cheng, Jr. with backdated operating authority licenses to make it appear as if the companies existed before the moratorium was in place. During that meeting, based on prior discussions with and at the direction of his son, Anthony Cheng, Sr. reimbursed public official number one with $1,500 in cash on his son’s behalf.
In addition, according to the court documents, Anthony Cheng, Jr. met in 2011 with a person he believed was an official with the District of Columbia Department of Consumer and Regulatory Affairs. This person actually was an undercover FBI special agent. On or about March 31, 2011, Anthony Cheng, Jr. met with the undercover agent and provided him with $250 in cash in return for backdated certificates of occupancy for two multi-vehicle taxicab companies.
The Chengs obtained two licenses for multi-cab companies—named Green Top Cab and ECO CAB Company—but never opened the businesses.
In announcing the pleas, U.S. Attorney Machen and Assistant Director in Charge Parlave commended the efforts of those who investigated the case from the FBI’s Washington Field Office. They expressed appreciation for the assistance provided by the Washington Field Office of the Internal Revenue Service-Criminal Investigation. They also acknowledged the work of those who handled the case for the U.S. Attorney’s Office, including Paralegal Specialists Krishawn Graham and Tasha Harris; former Paralegal Specialist Diane Hayes; and Assistant U.S. Attorneys Lionel André and Loyaan A. Egal, who are prosecuting the matter.