For two decades, the executives of a pair of closely tied
Kutztown construction companies fooled government agencies into giving them
business under a federal program to aid minority-owned businesses, prosecutors
say.
Between 1995 and 2011, Karen Construction made use of the
fact its majority owner, Judy Noll, was a woman to secure 224 federally funded
bridge and highway projects worth $18.7 million under the U.S. Department of
Transportation's disadvantaged business enterprises program.
But in court papers filed last week, federal prosecutors
say Karen Construction was a sham company controlled by Dennis and Dale Weber,
the president and vice president, respectively, of Carl M. Weber Steel Service.
The Webers and Noll, who is charged separately, each face
a charge of conspiracy to commit wire fraud. Their attorneys did not return
phone calls.
Court documents detailing the allegations say Noll
concealed the control Dennis and Dale Weber had over Karen Construction and
falsely represented that the company was independent.
Dennis Weber was in charge of sales and marketing for
Karen Construction and selected the federal highway projects for which the
company submitted bids, court papers say.
Dale Weber was a full-time employee of Karen Construction
and was in charge of purchasing materials for the projects for which the company
received bids.
Karen Construction also shared office space and workers
with Weber Steel, and leased equipment for its projects from Weber Steel.
Karen Construction created and submitted false reports,
certifications, invoices and letters misrepresenting to PennDOT and the U.S.
Department of Transportation that the company was qualified to receive business
under the disadvantaged business enterprises program, court papers say.
Dennis and Dale Weber allegedly ordered that profits from
Karen Construction be paid to them in year-end bonuses that were disguised
through false invoices to conceal the transfer of funds from Karen Construction
to the Webers.
If convicted, Noll and the Webers each face a maximum
sentence of five years in federal prison, two years of supervised release and a
$250,000 fine. Weber Steel also faces a five-year term of probation and a
$500,000 fine.
The case was investigated by the U.S. Department of
Transportation inspector general's office, the FBI and the U.S. Department of
Labor inspector general's office of labor racketeering and fraud investigation.
It is being prosecuted by Assistant U.S. Attorney Mary Kay Costello.
Source: The
Morning Call
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