WNYC's Bob Hennelly is an award-winning investigative journalist. While at WNYC he has reported on a wide gamut of major public policy questions ranging from immigration and homeland security to power outages and utility mergers.
Construction Firm Linked to Deutsche Bank Bilked City Out of Millions: Officials
Tuesday, April 24, 2012
One of the nation's largest contractors who was behind the construction of Citifield and the demolition of the Deutsche Bank building bilked the city of multi-millions on city, state and federal public works projects, a federal prosecutor charged Tuesday.
The projects involved includes Grand Central Terminal, the Bronx Criminal Courthouse, the Deutsche Bank building demolition, Citifield and scores of other public projects being built both in New York State and New Jersey.
The firm Lend Lease U.S. Construction LMB Inc., formerly known as Bovis Lend Lease, will pay the federal government back up to $56 million as part of a deferred prosecution agreement.
"Bovis circumvented rules governing minority business subcontractors," and engaged in "pervasive overbilling," Assistant FBI Director Janice Fedarcyk said Tuesday when revealing the results of the three-year investigation.
Federal prosecutors say the investigation turned up evidence that Bovis also defrauded the Port Authority of New York and New Jersey, the New York State Dormitory Authority and New Jersey's Schools Development Authority.
James Abadie, who led Bovis New York's office, pleaded guilty to his role in conspiracy charges linked to the scheme, prosecutors said. He faces up to 20 years in jail.
Under the deferred prosecution agreement, Bovis will be closely monitored but will be able to finish exiting projects and bid on new jobs.
A conviction on these kinds of federal charges can result in companies being banned from bidding for government contracts.
In 2009, Bovis received a similar non-prosecution agreement from the Manhattan District Attorney in connection back in 2009 for its role in the Deutsche Bank fire that killed two fire fighters in 2007. Retired Deputy Fire Chief Jim Riches close to the families who lost loved ones in the Deutsche Bank fire. He blasted Bovis' latest deal with prosecutors.
"Bovis is getting about the fifth chance in a row. They will be let off the hook and they will be given more contracts,” he said. “We say that they shouldn't be given anymore federal, state or city contracts where taxpayer money goes into it."
Other high profile Bovis projects involved in the Eastern District case include Citifield, home of the Mets, the re-modeling work at the Museum of Natural History and Grand Central Station.
Prosecutors said Bovis’s billing practices came to light when unnamed whistleblowers brought the scheme to their attention back in the spring of 2009. A broader federal investigation into the construction industry continues.