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Justice News

Department of Justice
U.S. Attorney’s Office
District of Columbia

Tuesday, July 5, 2016

Virginia Man Sentenced to 15 Months in Prison For Conspiring to Illegally Obtain Federal Contracts

Scheme Involved Program Meant to Aid Small, Disadvantaged Businesses

            WASHINGTON – Tarsem Singh, 61, a businessman from Fairfax, Va., was sentenced today to 15 months in prison for conspiring to commit fraud on the United States by illegally obtaining over $6 million in contracts that were meant for small, disadvantaged businesses.

            The sentencing was announced by U.S. Attorney Channing D. Phillips; Carol Fortine Ochoa, Inspector General of the U.S. General Services Administration (GSA); Peggy E. Gustafson, Inspector General for the U.S. Small Business Administration (SBA); and Paul M. Abbate, Assistant Director in Charge of the FBI’s Washington Field Office.

            Singh pled guilty to the charge in December 2015 in the U.S. District Court for the District of Columbia. He was sentenced by the Honorable Reggie B. Walton. Judge Walton also fined Singh $25,000 and ordered him to pay $119,165 in restitution. After his prison term, Singh will be placed on three years of supervised release and required to perform community service.

            The fraudulent activities involved the U.S. Small Business Administration’s 8(a) program, a program named for Section 8(a) of the Small Business Act. This program was created to help small, disadvantaged businesses compete in the American economy and access the federal procurement market. To qualify for the 8(a) program, a business must be at least 51% owned and controlled by a U.S. citizen (or citizens) of good character who meet the SBA’s definition of socially and economically disadvantaged.  The firm also must be a small business (as defined by the SBA) and show a reasonable potential for success.  Participants in the 8(a) program are subject to regulatory and contractual limits. Also, under the program, the disadvantaged business is required to perform a certain percentage of the work.

            According to the government’s evidence, from Jan. 12, 2000, through January 12, 2009, Singh and his wife, through a firm described in court documents as “Company A,” which specialized in construction and renovating and altering buildings, obtained millions in federal contracts.   On Jan. 12, 2009, “Company A” graduated from the SBA’s 8(a) program and was no longer eligible for contracts awarded through the program.

            On Jan. 12, 2009 - the same day that “Company A” graduated from the 8(a) program – “Company A” assisted a firm described in court documents as “Company B” apply to the 8(a) program.  “Company B” was certified to participate in the 8 (a) program on May 1, 2009.  Shortly after “Company B” was certified, Singh caused himself to be named its vice president.

            As the vice president of “Company B,” Singh was contacted by government personnel about federal contracts and, in some circumstances, made the decision on whether the company would bid on these projects. However, “Company B” was little more than a shell company that “Company A” helped create as it was graduating from the 8(a) program.  “Company B” lacked the employees to perform the 15% of the labor it was required to provide on the projects that Singh bid.  Throughout the life of the contracts obtained through this scheme, “Company B” had only one employee who performed work on the projects it was awarded.  Singh used a combination of “Company A” personnel and sub-contractors to staff projects awarded to “Company B.”

            From August 2009 through December 2010, “Company B” obtained a total of $6,808,552 in more than 25 federal contracts in this manner from the General Services Administration. The scheme generated at least $90,397 in profits for “Company A.” In addition, Singh received at least $28,768 in compensation attributable to the contracts.         

            To disguise the activities, Singh took a variety of steps, including:

  •             Obtaining magnetic logos bearing the name of “Company B”
  •             Directing a “Company A” employee to place “Company B’s” magnetic logos on a “Company A” vehicle when the vehicle would be used at construction sites for projects awarded by GSA.
  •             Using and directing other “Company A” employees to use “Company B” e-mail accounts when corresponding with the government about contracts awarded to “Company B.”
  •             Instructing “Company A” employees to tell GSA representatives that they were representing “Company B” on certain jobs.

            This investigation was conducted by the Inspector General’s Offices of the U.S. General Services Administration and the U.S. Small Business Administration and the FBI’s Washington Field Office. The prosecution was handled by Assistant U.S. Attorneys Matt Graves and John Marston of the Fraud and Public Corruption Section of the U.S. Attorney’s Office.

Financial Fraud
Updated July 6, 2016