| TRENTON
– Attorney General Stuart Rabner and
Criminal Justice Director Gregory A. Paw
announced that a former JCP&L manager
pleaded guilty today to conspiring with
two other men to steal $11.5 million from
a state energy rebate program and launder
the money.
According
to Paw, Harold Stamateris, 46, of Basking
Ridge, pleaded guilty before Superior Court
Judge Salem V. Ahto in Morris County to
an accusation charging him with first-degree
conspiracy. First-degree crimes carry a
state prison sentence of 10 to 20 years.
Stamateris will be ordered to pay full restitution
of $3.7 million for the money he stole,
and will pay $2.2 million at the time of
sentencing. He agreed to cooperate fully
in the state’s investigation.
Stamateris
admitted he knowingly approved $11.5 million
in payments for bogus or inflated applications
under the New Jersey Smart Start Buildings
Program, which offers rebates to companies
that install more efficient lighting or
HVAC systems. The program, funded by a surcharge
on utility bills, is mandated by the Board
of Public Utilities but administered by
utility companies. As program manager for
JCP&L, Stamateris reviewed and approved
applications.
“Mr.
Stamateris stole millions of dollars belonging
to ratepayers, which will not be tolerated,”
said Attorney General Rabner. “An
audit by JCP&L detected the fraud, and
we have ensured through this prosecution
that the defendant will be going to prison
for his crime.”
“We’ve
brought a number of cases recently against
defendants alleged to have stolen huge sums
from the state and its citizens in the form
of tax refunds, property tax rebates, housing
allowances and, in this case, energy rebates,”
said Director Paw. “In partnership
with other agencies, we are uncovering and
coming down hard on this type of fraud affecting
public programs.”
“I commend Attorney General Rabner
for his office’s in-depth investigation
and conclusion of this case,” said
Jeanne M. Fox, President of the BPU. “The
Board will work hand-in-hand with JCP&L
to ensure that all of the funds, when recovered,
are used for their intended purpose –
to implement energy efficiencies that will
reduce energy use, lower costs, and protect
the environment.”
Stamateris
said he split the proceeds of the fraudulent
rebate checks with two co-conspirators,
William D. Eaton Jr., 56, of Caldwell, an
electrical supply contractor, and Anant
Patel, 45, of Roxbury, a consultant hired
by JCP&L to inspect and verify installation
work in connection with rebate applications.
Eaton and Patel were arrested Jan. 12 by
the Division of Criminal Justice on charges
of first-degree money laundering and second-degree
theft by deception.
Eaton
was found dead from a gunshot wound on Jan.
30 in his home. His death has been ruled
a suicide. The charges remain pending against
Patel, who was released from the Morris
County Jail on Jan. 29 after posting $250,000
bail.
Yesterday,
Patel’s brother, Girish Patel, 50,
of Rockaway, pleaded guilty before Judge
Ahto to a charge of third-degree conspiracy,
admitting that he assisted Anant Patel and
Stamateris in stealing funds from the Smart
Start program and laundering money.
Eaton, who owned Light Source Energy Services
Inc. of Fairfield, allegedly prepared fraudulent
rebate invoices representing that his company
supplied and, in many cases, installed fixtures.
In reality, no fixtures were supplied or
the invoices inflated the number of fixtures
involved. Stamateris said he and Anant Patel
provided Eaton with false information to
use in the invoices.
For
example, Eaton claimed to have installed
fixtures for a Costco, a Marriot hotel,
Pfizer and a Barnes & Noble warehouse,
for which Light Source received rebates
of $109,000, $50,858, $77,360 and $55,950,
respectively. In fact, no fixtures were
supplied or installed. He inflated the cost
of fixtures supplied to two Morris County
School districts, receiving $492,000 in
rebates for $209,000 in fixtures for the
Parsippany/Troy Hills Board of Education,
and $233,800 in rebates for $87,000 in fixtures
for the Jefferson Township Board of Education.
Anant
Patel allegedly provided Eaton with detailed
information about actual commercial buildings
which Eaton used to prepare the false invoices
and supporting documents. Anant Patel allegedly
signed off on paperwork stating he had inspected
the work.
Stamateris
admitted that he reviewed the phony paperwork
and approved the rebate checks, which were
issued to Light Source by First Energy,
JCP&L’s parent company. Eaton
allegedly used several bank accounts to
launder the money. Light Source received
rebates totaling roughly $4.4 million, which
allegedly was divided by the three men.
Eaton allegedly paid Stamateris and Anant
Patel with cash or checks issued to consulting
companies they set up.
The
three men allegedly conspired in a second
scheme in which they arranged for Eaton’s
consulting company, Enernet Inc., to receive
fees that are paid to consultants under
the Smart Start program to conduct energy
efficiency studies for utility customers.
Stamateris said the three men split about
$2.5 million paid to Enernet in connection
with fraudulent studies.
Finally,
Stamateris admitted that he conspired with
Anant Patel to recruit individuals, including
Girish Patel, to help set up 12 other contracting
and consulting companies to submit bogus
applications to the Smart Start program.
Those companies received roughly $4.6 million,
which was divided among the co-conspirators.
Girish
Patel admitted during his plea hearing yesterday
that he submitted phony rebate applications
on behalf of a company he owned and operated,
Energy Reduction Associates Inc., and received
rebate checks totaling $84,816, which he
divided with Stamateris and Anant Patel.
The
case was referred to the Division of Criminal
Justice by JCP&L’s internal audit
group. The case is being investigated and
prosecuted for the Division of Criminal
Justice - Major Financial Crimes Bureau
by State Investigator Louis A. Matirko and
Supervising Deputy Attorney General Rodger
Wolf.
The
charges against Anant Patel are merely accusations
and he is presumed innocent until proven
guilty.
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