BOSTON - A Dover, NH, man was convicted yesterday in federal court of defrauding the City of Lawrence of more than $5,000 while serving as the Director of the city’s Informationi Technology (IT) Department.
Bryan J. Cahoon, 53, pleaded guilty before U.S. District Judge Rya W. Zobel to a one-count Information alleging fraud and theft concerning programs receiving federal funds.
Had the case proceeded to trial the Government’s evidence would have proven that in 2008 and 2009, Cahoon steered municipal contracts and paid internships to his friends and associates, who then performed services for Cahoon’s private company, Networks@Home, which had subcontracted work on projects for City of Lawrence from another company.
According to the Information and disclosed today in open court, Cahoon worked under a contractual arrangement with the City of Lawrence to serve as the city’s IT Director from April 2007 through January 2010. During this time, Cahoon had an ownership interest in a company called Networks@Home, which provided computer networking and telecommunications services. In 2008 - 2009, Networks@Home subcontracted IT-related work at the Lawrence Public Library and other city properties from another technology company. During that time frame, and in his capacity as IT Director for Lawrence, Cahoon steered city contracts just under $25,000, to friends and associates. He also hired acquaintances as interns for the IT Department by means of contracts just under $5,000. Cahoon then utilized the services of the individuals who had been awarded city contracts and paid internships with his assistance to perform work on city projects on behalf of Networks@Home. Effectively, therefore, the City of Lawrence was double billed for the same work, while Cahoon did little to no work in return for the funds he obtained from the city.
A substantial portion of the funds used to pay for work at the Lawrence Public Library, as well as discounts associated with IT equipment and services, came from the federal “E-Rate” program. The E-Rate program provides discounts to assist most local schools and libraries to obtain affordable telecommunications and Internet access.
Judge Zobel scheduled sentencing for Nov. 19, 2013. Cahoon faces up to 10 years in prison, to be followed by three years of supervised release and a $250,000 fine.
United States Attorney Carmen M. Ortiz, Vincent B. Lisi, Special Agent in Charge of the Federal Bureau of Investigation - Boston Field Division, Jonathan W. Blodgett, Essex County District Attorney and Glenn A. Cunha, Inspector General for the Commonwealth of Massachusetts, made the announcement. The case is being prosecuted by Assistant U.S. Attorney William F. Bloomer.