BOSTON, MA - Acting United States Attorney Michael K. Loucks, Theodore L. Doherty, III, Special Agent in Charge of the U.S. Department of Transportation, Inspector General’s Office in New England, Warren T. Bamford, Special Agent in Charge of the Federal Bureau of Investigation - Boston Field Division and Gordon S. Hedell, Inspector General of U.S. of the Department of Labor – Office of Labor and Racketeering, announced today that MODERN CONTINENTAL CONSTRUCTION CO. (“MODERN CONTINENTAL”), pled guilty before U.S. District Judge Douglas P. Woodlock to violations of making false statements in connection with the Central Artery/Tunnel project (“the Big Dig”). Specifically, MODERN CONTINENTAL pled guilty to making a false statement with respect to the construction of the slurry wall panel that ruptured in September 2004 flooding the I-93 roadway (“the slurry wall panel”) and to making numerous false statements in connection with the billing of apprentice workers at journeymen rates on various Big Dig contracts.
At today’s plea hearing, the prosecutor told the Court that had the case proceeded to trial the Government’s evidence would have proven that various field personnel, who worked for MODERN CONTINENTAL at the time of the construction of slurry wall panel, were aware of major defects and noncompliance with the contract specifications. Evidence also would have proved that MODERN CONTINENTAL subsequently falsely certified that the work in question was completed in accordance with those specifications. The defects in the slurry wall panel later resulted in its rupture in September 2004, prompting the CA/T to conduct detailed inspections of all of the wall panels in the main tunnel. The Government would have also proven that MODERN CONTINENTAL, as a matter of practice, routinely billed apprentice workers at the higher journeymen rate for time and materials work performed on all of its Big Dig contracts, though it paid the workers the lower apprentice rate.
MODERN CONTINENTAL filed for bankruptcy in June 2008. Judge Woodlock scheduled sentencing for August 11, 2009. MODERN CONTINENTAL faces up to a $19,500,000 fine.
The case was investigated by the U.S. Department of Transportation - Office of Inspector General, the Federal Bureau of Investigation and the U.S. Department of Labor. It is being prosecuted by Assistant U.S. Attorneys Jeffrey Cohen and Anthony Fuller of Loucks’ Public Corruption Unit.