Calif. Masonry Firms in $1.9M Settlement of Alleged False DBE Claims

In a federal action involving alleged false claims on construction contracts, five California masonry subcontractors have paid the government about $1.9 million to resolve charges that they misrepresented themselves as small disadvantaged businesses on projects for the U.S. military, the Dept. of Justice has said.

Parties to the settlement, which Justice announced on April 9, include Frazier Masonry Corp., F-Y Inc., CTI Concrete & Masonry Inc., Masonry Technology Inc., Masonry Works Inc., Russell Frazier and Robert Yowell The settlement document lists Yowell as president of F-Y Inc.

The 19-page agreement also says the defendants’ payment includes $1,175,000 plus a share of the proceeds of the sale of Russell Frazier’s house in Camarillo, Calif.

ENR phoned Frazier Masonry, based in Lancaster, Calif., seeking a reaction or comment but the person who answered the phone said the company had no comment. A call to the number listed on CTI Concrete & Masonry’s web page said the number was disconnected or not in service. A call to the number on F-Y Inc.’s web page got a recorded message that no calls were being accepted.

At issue are contracts from 2009 to 2012 to build facilities at U.S. Marine Corps bases at Camp Lejeune, N.C., and Camp Pendleton, Calif.

The federal government alleged that the firms and their principals misrepresented to prime contractors that they were small businesses.

According to the agreement, the government contends the defendants caused the prime contractors to falsely certify that masonry subcontractors F-Y, CTI Concrete & Masonry, Masonry Technology and Masonry Works were “qualified disadvantaged small businesses” for the work under the contracts.

The contracts included provisions requiring that small disadvantaged firms carry out certain shares of the dollar-amounts of the work.

DOJ said Russell Frazier earlier had pleaded guilty “in related criminal proceedings to causing false statements.”

The department noted that the claims in the settlement are allegations. The settlement document states, “This agreement is neither an admission of liability by the [defendants] nor a concession by the United States that its claims are not well founded, except to the extent admitted in Russell Frazier’s guilty plea.”

DOJ said the settlement resolves allegations contained in two lawsuits filed by Rickey Howard, a former Frazier Masonry employee, in federal court in Raleigh, N.C.

The lawsuits were filed under the False Claims Act’s whistleblower provisions, which permit individuals to sue on behalf of the federal government.

The statute also permits the government to take over the case, which it did in this instance. Howard will receive $393,383, Justice said.

Updated on April 11 to include link to text of settlement agreement.

Tom Ichniowski has been writing about the federal government as ENR’s Washington Bureau Chief since the George H.W. Bush administration, and he has covered at least five major highway bills. A recognized expert on government policy on infrastructure and regulation, Tom is also a Baltimore native and Orioles fan who grew up rooting for Brooks and Frank Robinson. He is a graduate of Columbia College and Columbia’s graduate school of journalism, where he once used “unrelentless” in a headline.

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