Northern Illinois Contractor Pleads Guilty to Benefit, Tax Scams

Thomas Manning thought that neither his employees nor the federal government wouldn’t notice their shortfall. He turned out to be wrong. On October 16, Manning, president of a now-defunct Chicago-area concrete contracting firm, pleaded guilty in U.S. District Court for the Northern District of Illinois to defrauding union benefit plans out of about $2 million in scheduled contributions and evading another $600,000 in federal payroll taxes. He had been indicted on 27 counts back in March 2015. The workers who had been denied benefits were represented by locals of the Laborers and Cement Masons unions.

Manning, now 60, was president of T. Manning Concrete Inc., based in the outer northwest Chicago suburb of Huntley, Ill. His company had been bound by various collective bargaining agreements to submit monthly reports to union-sponsored benefit plans stating the number of hours each employee worked and to make contributions reflecting these hours. According to the plea agreement, he did not do these things. During 2007-10, Manning willfully understated employee hours and underpaid contributions to benefit plans. He compensated for the missing hours by paying workers “under the table” checks drawn from non-payroll bank accounts under his control. As a result, union employees were deprived of nearly $2 million in scheduled benefits. This caused unsuspecting plan managers to make false statements in annual Labor Department reports. Benefit fraud had a corollary in tax fraud. Manning admitted that during the benefit scheme, he also did not collect or pay scheduled $600,680 worth of employee FICA (Social Security and Medicare Part A) payroll taxes to the IRS.

The situation doesn’t look good for Thomas Manning. At sentencing, scheduled for January 24, he faces a $250,000 fine, up to five years in prison and up to three years of supervised release for each count to which he pled guilty. No doubt he will receive leniency. But if and when he gets out, he won’t have any business to run. The State of Illinois dissolved T. Manning Concrete back in 2012.