WTC contractor found guilty of wire fraud, conspiracy over MBE scheme

0
426

Larry Davis, the Canadian owner of a company that had contracts worth nearly $1 billion to do construction work at the World Trade Center, has been convicted of charges that he defrauded a program intended to promote minority- and women-owned businesses.

A federal jury in Manhattan found Davis, 65, and his company, DCM Erectors Inc, on charges of wire fraud and conspiracy to commit wire fraud.

Davis is scheduled to be sentenced on Nov. 15.

“We are of course disappointed in the verdict and will file the appropriate motions and appeal,” his lawyer Sanford Talkin said in a statement after the verdict.

The charges resulted from contracts DCM Erectors won to perform work for the Port Authority of New York and New Jersey on the 104-story Freedom Tower and a nearby transportation center built after the Sept. 11, 2001, attacks destroyed the World Trade Center.

Prosecutors said contracts required Davis to devote tens of millions of dollars to hire businesses owned by minorities and women as subcontractors.

Prosecutors said he instead structured two purported minority- or women-owned firms as fronts, paying kickbacks to their principals to sign papers submitted to the Port Authority while the work was actually performed by DCM or another related company.

DCM received a $256 million contract to erect steel in the Freedom Tower in 2007 and a $330 million contract in 2009 for work at the World Trade Center Transportation Hub.

Work scope changes helped to increase costs to almost $1 billion, prosecutors said.

Davis and DCM denied wrongdoing.  They asserted they never intended to make any false claims to the Port Authority about the work being done and that the subcontractors did the work that was promised.

“What Larry Davis did between 2008 and 2012 and a little beyond is dedicate his life, dedicate his business to rebuilding the World Trade Center,” Talkin said in opening statements at trial.

The trial came two years after Davis, a resident of Mississauga, Ontario, was arrested. Ge told a judge in an Oct. 2014 court appearance that he would plead guilty, but then reversed his decision, telling the judge that he did not know that what he did was wrong.

Johnny Garcia and Gale D’Aloia, the principals of the two businesses that prosecutors said participated in the scheme, pleaded guilty in 2014 and cooperated with authorities.

“We cannot allow major public projects — particularly ones on the sacred World Trade Center site — to be built on a foundation of fraud,” U.S. Attorney Preet Bharara said in a statement. “By its verdict today, the jury of New Yorkers made clear that it will not.”

LEAVE A REPLY

Please enter your comment!
Please enter your name here