Whistleblower, Coakley take on construction company

Keith Loria Oct. 12, 2010, 10:29am


SPRINGFIELD, Mass. - Massachusetts Attorney General Martha Coakley filed a lawsuit on Thursday against a construction company that was allegedly involved in construction fraud.

Petricca Construction Company, a Pittsfield, Mass. contractor, allegedly falsely certified compliance with contracts that required the participation of State Office of Minority and Women Business Assistance approved minority- and woman-owned businesses on nine public construction projects.

Petricca allegedly violated the Massachusetts False Claims Act by submitting bids for the projects that required Petricca to use minority- and woman-owned businesses for work equal to a certain value of the contract, and then using non-minority and non-woman contractors.

Coakley's suit claims that between 2004-2008, Petricca filed approximately 184 fraudulent certifications and fell nearly $600,000 short of its commitment. Coakley's office was alerted to the alleged conduct by a whistleblower, a minority contractor who says he or she had been cut out of work by Petricca.

"A contractor that wins contracts based on false pretenses puts honest contractors at an unfair competitive disadvantage," Coakley said. "Causing the government to pay out funds based on false representations is a breach of the public trust subject to stiff penalties under the False Claims Act."

For many Massachusetts construction projects, bid specifications require bidders to demonstrate good faith efforts to employ minority- and woman-owned subcontractors to fulfill participation goals. Those bids are given preference in the bidding process.

Once a contractor's bid is successful, that contractor is required to comply with the terms of its bid in completing the project or seek a waiver of compliance. A contractor must certify at the end of the project that it has complied with all terms.

The suit claims that on one of the nine projects, Petricca submitted a bid in the amount of $607,750.50 for construction of a water tank in Adams, Mass.

The company allegedly said it would use the minority-owned sub-contractor Larry's Trucking to perform 225.01 hours of trucking at a unit price of $80 per hour. Instead, the company allegedly only used the business for eight hours, with the remaining work performed by non-minority trucking companies at a rate of $65 per hour. Larry's Trucking was also paid $15 for each hour of trucking performed by a non-minority business, despite doing nothing, Coakley says.

When the project was over, Petricca falsely certified to the commonwealth that Larry's Trucking had performed work valued at, and was paid, $44,785.01.

Larry's Trucking was the whistleblower in this case. In Massachusetts, an individual is allowed to file a lawsuit on behalf of the commonwealth against government contractors for fraud against the government. Coakley's office intervened and assumed control of the false claims action.

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