– Acting Attorney General Paula T.
Dow and Criminal Justice Director Stephen
J. Taylor announced that a contractor from
Red Bank pleaded guilty today to making
false representations in connection with
state contracts awarded by former Department
of Corrections administrator Gerald T. Kennedy.
Kennedy pleaded guilty last month to orchestrating
a bid rigging and kickback scheme involving
hundreds of thousands of dollars in state
to Director Taylor, Mark Stermer, 43, of
Red Bank, and his company, SteelGrey LLC,
each pleaded guilty today to a second-degree
charge of making false representations for
government contracts before Superior Court
Judge Ira E. Kreizman in Monmouth County.
pleading guilty, Stermer admitted that he
submitted a fraudulent financial statement
and false information about past projects
of the company on an application by SteelGrey
to the state Division of Property Management
and Construction for approval to work on
state contracts. The DPMC approved the application,
and SteelGrey was awarded seven contracts
worth approximately $153,000.
the plea agreement, the state will recommend
that Stermer be sentenced to three years
in state prison. He and his company will
be barred from doing business with the state
for 10 years.
Attorney General Pearl Minato took the guilty
plea for the Division of Criminal Justice
Corruption Bureau. Judge Kreizman scheduled
sentencing for Stermer and SteelGrey for
Jan. 14, Kennedy, 47, of Red Bank, pleaded
guilty before Judge Kreizman to a second-degree
charge of conspiracy to commit various crimes,
including official misconduct, bribery,
money laundering, theft by deception, making
false representations for government contracts,
and use of a corporation for the furtherance
of a criminal object.
state will recommend that Kennedy be sentenced
to seven years in state prison. He must
disgorge $80,000 in kickbacks he received
and pay a fine in an amount to be set by
the judge. He will be permanently barred
from public employment in New Jersey.
charges against Stermer and Kennedy were
contained in an April 2, 2008 indictment.
pleading guilty, Kennedy admitted that between
December 2002 and March 2006, he steered
more than $630,000 in state contracts to
three companies that were owned by friends,
including SteelGrey. As Assistant Director
of the DOC Division of Operations, in charge
of the Capital Planning & Construction
Unit, Kennedy had control over soliciting
bids and selecting contractors for small
capital projects costing under $41,100.
admitted that he steered approximately $153,000
in state contracts to SteelGrey. Kennedy
and Stermer are friends.
also admitted that he steered state contracts
totaling approximately $348,000 to Pro General
Contracting Inc., aka Pro Painting &
General Contracting Inc. Another defendant
in the case, Jasher Guerrero Ramos, was
listed in corporate records as owner of
Pro Painting, but Kennedy actually controlled
the company. Kennedy admitted he received
approximately $40,000 in kickbacks on those
contracts with the help of Guerrero Ramos
and another man, Ronald Hayes. Both Guerrero
Ramos and Hayes have pleaded guilty in the
Kennedy admitted that he received more than
$34,000 in kickbacks on state contracts
totaling $128,850 that he awarded to SBC
Construction Inc., the company of another
friend, Alfred “Buddy” Canale.
Canale has also pleaded guilty.
Kennedy was required to seek bids from at
least three pre-qualified contractors, he
frequently solicited bids exclusively from
the companies he and his friends controlled,
and he often dictated the amount of each
bid so he could award the contract as he
desired. The contracts were for masonry,
painting, "skirting" of a trailer,
roofing repairs and other general projects.
Department of Corrections reported suspected
irregularities in the bidding process on
small capital projects to the Division of
Criminal Justice in early 2006.
Ramos pleaded guilty on Dec. 14, 2009 to
bribery, a second-degree crime. The state
will recommend that he be sentenced to five
years in state prison. Canale pleaded guilty
to bribery on Dec. 21, 2007. The state will
recommend that he be sentenced to three
years in prison. Hayes pleaded guilty on
Nov. 26, 2007 to a third-degree charge of
offering an unlawful benefit to a public
servant for official behavior. Another man,
Delfim Rodrigues, pleaded guilty on Feb.
28, 2008 to the same charge as Hayes. Rodrigues’
company, DEL ROD Inc., was a subcontractor
on the SBC Construction contracts, and Rodrigues
admitted providing kickbacks to Kennedy.
The state will recommend that Hayes and
Rodrigues be sentenced to probation.
Attorneys General Steven J. Zweig and Pearl
Minato are prosecuting the case. The investigation
was conducted and coordinated by Lt. Keith
Lerner, Detective Paul Marfino and Deputy
Attorney General Zweig of the Division of
Criminal Justice Corruption Bureau, assisted
by Senior Investigator Manuel Alfonso of
the Department of Corrections, Special Investigations
Division, who was sworn in as a special
investigator for the Division of Criminal
Taylor noted that the Division of Criminal
Justice Corruption Bureau has established
a toll-free Corruption Tipline 1-866-TIPS-4CJ.
The public can also log on to the Division’s
Web site www.njdcj.org
to confidentially report suspected wrongdoing.