Fraudulent Highway Contractor Gets 5 Years’ Imprisonment, $18,000 fine |
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USDOT Office of the Inspector General
June 13, 2000
FOR IMMEDIATE RELEASE
Tuesday, June 13, 2000
Contact: Jennifer Gavin
Acting Communications Director
Telephone: (202) 366-2009
OIG 3-00
An Ohio man whose highway-construction firm conspired with a “front” firm to defraud the federal Disadvantaged Business Enterprise program was ordered imprisoned for five years and fined $18,000 on June 5, 2000 in U.S. District Court in Wheeling, W.Va., the U.S. Department of Transportation Office of Inspector General said today.
Kermit Wayne Bunn of Marietta, Ohio also must serve three years’ supervised release for his role in a scheme that fraudulently obtained work on five West Virginia highway projects worth more than $747,000. He was convicted at trial in November of fraud, obstruction of justice and perjury; one of the obstruction counts stemmed from his threat against a special agent of the Department’s Office of Inspector General.
DOT regulations encourage winners of federally financed highway-construction contracts to subcontract some portion of the work – typically 8 percent to 12 percent of the project price – to disadvantaged business enterprises, defined as small businesses controlled by socially and economically disadvantaged owners.
During a 17-day jury trial, prosecutors showed that Bunn conspired with Charles Carlton Striblin of Belpre, Ohio, who was listed as the owner of a disadvantaged business enterprise that was actually a front firm formed to promote the scheme.Bunn’s firm not only performed the work represented as having been done by Striblin’s company, but handled all aspects of the Striblin firm’s business including hiring and firing and negotiating materials contracts.
Striblin was convicted of obstruction of justice and perjury. His sentencing is still pending.
In a related case, Brenda Kay Ware, president of Brothers Construction Co., a firm certified as disadvantaged, was convicted in 1997 for her role in a secret agreement to have a non-certified firm perform her company’s highway-contract work.
The Bunn case was investigated by DOT’s Office of Inspector General and the West Virginia Department of Transportation Auditing Division, and prosecuted by trial attorneys from the U.S. Department of Justice Fraud Section in Washington, D.C.