Western New York contractor pleads guilty to MBE business documentation fraud

0
252
Buffalo Psychiatric Center
The Buffalo Psychiatric Center

A western New York construction company which fraudulently submitted minority-owned business documentation for a state construction project has pleaded guilty in Erie County Court..

Nichter Construction, Inc. pled guilty on Feb. 19 before Erie County Court Judge Sheila A. DiTullio to one count of Offering a False Instrument for Filing in the First Degree, a Class “E” felony.

The plea is in full satisfaction of charges filed in July 2018. The defendant filed documents with the Dormitory Authority of the State of New York (DASNY) falsely claiming that McClendon Asphalt Paving, a minority-owned subcontractor company, performed work on a state-funded project.

An investigation by the Erie County District Attorney’s Office and the New York State Inspector General’s Office found that Nichter Construction entered into $350,000 contract with DASNY on Nov. 5, 2015 to perform building improvements at the Buffalo Psychiatric Center.

Under Article 15A of the New York State Executive Law, Nichter Construction was required to have a minimum of 13 percent minority business participation in the project. Nichter recruited William McClendon of McClendon Asphalt Paving to purportedly be the project’s minority business participant. Nichter submitted various documents to DASNY falsely claiming that McClendon was performing plumbing and electrical work on the project at a cost of nearly $44,000. McClendon also allegedly filed a document with DASNY claiming that his company was performing this work on the project.

Nichter instead contracted with other companies to perform both the plumbing and electric work. McClendon Asphalt Paving performed no work on the state project. McClendon, who was never seen at the job site, was to be paid a fee by Nichter, solely for the use of its identity in order to give the false appearance of minority business participation.

Nichter Construction, Inc., is scheduled to appear on April 30 for sentencing. The corporation faces a maximum fine of $10,000.

McClendon, 51, of Niagara Falls, pled guilty on Feb. 15 to a violation for his role in circumventing state contracting requirements and wassentenced to a conditional discharge.

“This law was enacted to provide minority and women-owned businesses an opportunity to work on state-funded projects, and these defendants attempted to abuse a system that was intended to increase diversity,” said Erie County District Attorney John Flynn. “My office along with the State Inspector General will continue to investigate and prosecute any business owners who attempts to take advantage of taxpayer dollars for their own benefit. I hope the residents of New York State feel justice has been served by the defendants pleading guilty today.”

LEAVE A REPLY

Please enter your comment!
Please enter your name here

This site uses Akismet to reduce spam. Learn how your comment data is processed.