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TRENTON
- Attorney General Paula T. Dow and Criminal
Justice Director Stephen J. Taylor announced
that three current and former managers for
Laidlaw Transit Services, Inc. have been
indicted for deliberately falsifying records
in order to overcharge Burlington County
approximately $450,000 for bus services.
According
to Director Taylor, the Division of Criminal
Justice Corruption Bureau obtained a six-count
state grand jury indictment charging the
following men:
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Paul O’Brien, 43,
of Hillsborough, N.J., District Manager
for Laidlaw Transit Services;
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Richard Miranda, 36,
of Universal City, Texas, former Project
Manager for Laidlaw; and
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Reinaldo Monzon, 55,
of Hamilton, N.J., former Operations Manager
for Laidlaw.
The
indictment was returned by the state grand
jury on Dec. 13, 2010, but was sealed by
court order until today. It charges each
defendant with conspiracy (2nd degree),
making false payment claims for a government
contract (2nd degree), making false representations
for a government contract (2nd degree),
theft by deception (2nd degree), tampering
with public records or information (3rd
degree), and falsifying or tampering with
records (4th degree).
The
indictment alleges that between Nov. 1,
2002 and Oct. 31, 2007, the defendants,
in their roles as managers for Laidlaw Transit
Services, knowingly or purposely submitted
invoices and other documents to Burlington
County that contained material misrepresentations
and fraudulent information. The false information
was submitted in connection with two contracts
between Burlington County and Laidlaw Transit
Services for bus services: (1) a contract
to operate the Burlington County Transportation
System (BCTS) for the Elderly and Adult
Disabled, and (2) a contract to operate
the BURLINK transit system, a fare-based
public transit system on set routes throughout
the county. It is alleged that as a result
of the fraud and misrepresentations by the
defendants, Burlington County was overbilled
approximately $450,000.
“With
this indictment, we send a strong message
to corporate officials who do business with
state, county and local agencies,”
said Attorney General Dow. “If you
cheat the taxpayers of New Jersey, we will
catch you and we will prosecute you.”
“Government
agencies pay millions of dollars each year
under public contracts and must be able
to count on the integrity of the vendors
with whom they do business,” said
Director Taylor. “We will thoroughly
investigate any allegations of corporate
corruption in government contracts.”
The
case was referred to the Division of Criminal
Justice by the Burlington County Prosecutor’s
Office, after county officials alerted the
prosecutor’s office about suspicious
discrepancies in documentation submitted
by Laidlaw Transit Services.
The
investigation by the Division of Criminal
Justice Corruption Bureau revealed that,
with respect to the BCTS contract, the defendants
allegedly conspired to submit false invoices
and supporting documentation that reported
higher numbers of trips made than can be
accounted for by the numbers of actual riders
who used the transportation system. The
system includes routes to Buttonwood Hospital,
the Veterans Administration Hospital in
Philadelphia, the Tender Adult Day Care
Center in Moorestown, and Burlington County
Nutrition Program sites. The county paid
Laidlaw a certain rate per trip, times the
actual number of trips provided.
Under
the BURLINK contract, Laidlaw was paid based
on the monthly hours of operation multiplied
by a contractual hourly rate. The investigation
revealed that the defendants allegedly falsified
documents submitted to the county to show
reduced ridership. This fact is significant
because all cash fares collected by Laidlaw
were subtracted from the amount paid to
Laidlaw under the terms of the contract.
By fraudulently underreporting ridership
and fares collected, the defendants increased
the amounts paid to Laidlaw by the county.
Laidlaw
was acquired by First Transit, Inc. in early
2008. Neither Laidlaw nor First Transit
currently have contracts with the county.
This
is the second indictment obtained as a result
of the investigation. On Feb. 11, 2009,
the Division of Criminal Justice obtained
a state grand jury indictment charging Isaiah
Davis, 63, of Clementon, a former project
manager at Laidlaw’s Cinnaminson location,
with overbilling the county under the BCTS
contract between March 10, 2003 and Feb.
19, 2004. Davis allegedly overcharged the
county by approximately $32,956 by billing
for bus trips that were not provided on
the routes to Buttonwood Hospital and the
VA Hospital. That indictment is pending.
Deputy
Attorney General Anthony A. Picione, deputy
chief of the Division of Criminal Justice
Corruption Bureau, and Deputy Attorney General
Peter Lee presented the indictments to the
state grand jury. The investigation was
conducted and coordinated for the Division
of Criminal Justice Corruption Bureau by
Detective Stacy Scott, who is lead detective,
Detective Sgt. David Patella, who is now
retired, Detective Sgt. David Nolan, Civil
Investigator Wayne Cummings, and Deputy
Attorneys General Picione, Lee, Pearl Minato
and Frank Muroski.
The
indictment was handed up to Superior Court
Judge Edward M. Neafsey in Mercer County,
who assigned the case to Burlington County,
where the defendants will be ordered to
appear in court at a later date to answer
the charges.
Second-degree
crimes carry a maximum sentence of 10 years
in state prison and a $150,000 fine, while
third-degree crimes carry a maximum sentence
of five years in prison and a $15,000 fine.
Fourth-degree crimes carry a maximum sentence
of 18 months in prison and a $10,000 fine.
The
indictment is merely an accusation and the
defendants are presumed innocent until proven
guilty. A copy of the indictment is available
with this press release at www.njpublicsafety.com.
The
Division of Criminal Justice has established
a toll-free Corruption Tipline 1-866-TIPS-4CJ
for the public to report corruption, financial
crime and other illegal activities. The
public can also log on to the Division Web
site at www.njdcj.org
to confidentially report suspected wrongdoing.
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