Business Owner Sentenced for Fraudulently Obtaining More Than $2.8 Million in Government Contracts
Posed as a Minority or Disabled Veteran to Win Government Contracts Reserved for Disadvantaged Groups
Greenbelt, Maryland - U.S. District Judge Deborah K. Chasanow sentenced Wesley Burnett, age 54, of Hermosa Beach, California, today to 42 months in prison followed by three years of supervised release for wire fraud conspiracy in connection with a scheme to fraudulently obtain more than $2.8 million in federal government contracts through a Small Business Administration (SBA) program designed to assist disadvantaged businesses. Judge Chasanow also entered an order that Burnet forfeit $694,893.99.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Small Business Administration Inspector General Peggy E. Gustafson; Brigadier General Keith M. Givens, Commander Air Force Office of Special Investigations; and Mary L. Kendall, Deputy Inspector General, Department of the Interior.
According to his plea agreement, Burnett owned and operated Confederate Group LLC and Total Barrier Works (TBW), which maintained and installed anti-terrorist systems and vehicle control equipment such as security barriers, bollards, gates, uninterrupted power systems and other perimeter security anti-terrorist equipment.
Burnett admitted that from 2007 until 2014, he falsely represented to the U.S. government that Confederate Group was a “Hispanic-American owned business,” a “minority owned business,” a “service disabled veteran owned business,” and a “small disadvantaged business,” in order to win federal contracts at military bases and federal buildings that were reserved for firms in those categories. In fact, Burnett was not a member of any racial or ethnic minority, was not a disabled veteran and was not a member of a socially disadvantaged group. As a result of these fraudulent representations, from 2008 through 2014 Confederate Group was awarded approximately $534,315 in contracts reserved for minorities and disabled veterans.
In order to bid on the contracts, Burnett recruited members of racial or ethnic minorities, service disabled veterans, or members of socially disadvantaged groups, and offered them a percentage of any contract he won using their companies’ name. Burnett and TBW performed all of the work covered by the contract, then paid the owner of the company in whose name the contract had been awarded a fixed percentage of the gross value of the contract, usually between four and five percent. To further this “pass thru” arrangement, Burnett falsely represented that TBW was a trade name for the minority owned company in whose name the contract had been awarded, when in fact TBW was a separate company.
For example, Yogesh K. Patel was the owner of United Native Technologies, Inc. (UNTI), which purported to perform information technology services to the government and commercial clients. In 2005, Patel applied for and was granted certification as a minority or socially disadvantaged owned business under SBA’s program. In addition to a broad scope of assistance from SBA, participants in the program can receive sole source government contracts that are reserved for minority or socially disadvantaged owned companies.
Burnett met Patel at a business conference and the two agreed to use UNTI to bid on SBA set aside contracts at federal government installations, including military bases and federal buildings, with Burnett, TBW and individuals at Burnett’s direction actually performing the work. Burnett also agreed to pay Patel approximately 4.5% of any contract awarded to UNTI. From January 2010 and November 2013, UNTI was fraudulently awarded more than $1.8 million in set-aside U.S. government contracts, while the work on the contracts was actually performed by Burnett’s company and employees.
Burnett admitted that he had similar arrangements with the owner of a minority firm that did electrical and other work for government and commercial clients, and with the owner of a service-disabled veteran-owned small business. Burnett also fraudulently obtained the personal identifying information of a service-disabled veteran, which he then used when bidding on federal government contracts.
Yogesh K. Patel, age 47, of Gaithersburg, Maryland, previously pleaded guilty to his role in the scheme and awaits sentencing.
The National Procurement Fraud Task Force was formed in October 2006 to promote the early detection, identification, prevention and prosecution of procurement fraud associated with the increase in government contracting activity for national security and other government programs. The Procurement Fraud Task Force includes the United States Attorneys’ Offices, the FBI, the U.S. Inspectors General community and a number of other federal law enforcement agencies. This case, as well as other cases brought by members of the Task Force, demonstrates the Department of Justice’s commitment to helping ensure the integrity of the government procurement process.
United States Attorney Rod J. Rosenstein praised the SBA OIG, U.S. Air Force Office of Special Investigations, and the Department of the Interior, OIG for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorneys Leo J. Wise and Sean R. Delaney, who prosecuted the case.