Jesus Jose Mendez and Jamie Zambrano kept two sets of books and got rich – for a while anyway. On October 9, the pair, owners of a drywall firm in Woonsocket, R.I., were indicted in U.S. District Court for the District of Rhode Island on 28 counts related to fraud, tax evasion and structuring. The scam netted them millions of dollars. The case has all the hallmarks of “double-breasting,” a common practice in non-Right to Work states in which an employer under union contract sets up a parallel nonunion company for the purpose of avoiding compliance. While this setup isn’t necessarily illegal, it usually is. The identity of the union has been withheld for now. The indictment follows a joint probe by the IRS, the U.S. Labor Department’s Office of Labor-Management Standards and Office of Inspector General, and Rhode Island State Police.
Jesus Jose Mendez, now 43, and Jamie Zambrano, … Read More ➡
Benefit fraud in the construction industry has become disturbingly common, especially in the New York City area. On July 30, Donal O’Sullivan, president and owner of Navillus Contracting, Inc., helped by two other Navillus executives, his sister Helen O’Sullivan and Padraig Naughton, respectively, treasurer and controller, were indicted in Brooklyn federal court on 11 counts related to their alleged defrauding of union benefit plans of more than $1 million over six years. The defendants were arrested, arraigned and then released on bail. In an August 3 letter to clients, Donal O’Sullivan stated, “These allegations are against us personally, and we have no choice but to commit ourselves to clearing our names.” All three defendants have stepped aside “temporarily,” with company operations chief Colin Mathers taking over as interim CEO.
Founded in 1987, Navillus Contracting is one of the largest commercial construction firms in New York City, specializing in … Read More ➡