Electric Company Owner Pleads Guilty In Navy Exchange Procurement Fraud Scheme
Greenbelt, Maryland – Noe Rodriguez, age 34, of Boyds, Maryland, pleaded guilty today to making false statements, and illegal possession of a firearm by an alien, arising from a scheme in which he failed to comply with federal wage, hour and records regulations under the Davis-Bacon Act.
The plea agreement was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Bill Jones, U.S. Department of Labor - Office of Inspector General, Office of Labor Racketeering and Fraud Investigations, Washington Regional Office; Special Agent in Charge Rocco Pierri of the Naval Criminal Investigative Service, Washington Field Office; and Special Agent in Charge Michael McGill of the Social Security Administration - Office of Inspector General, Philadelphia Field Division.
According to his plea agreement, Rodriguez was a citizen of Mexico who entered the United States illegally in the late 1990s. He moved to Maryland in 2003, and began operating an electrical contracting business in the Washington, D.C. metropolitan area under various corporate guises, including RDZ Electric, RCM Services, Rodriguez Electric and O&G Electric. Rodriguez provided electrical work on numerous construction projects in the Washington, D.C. metropolitan area as an electrical subcontractor.
Rodriguez, on behalf of RDZ, provided electrical work during the construction of the Navy Exchange (NEX) at the National Military Medical Center located in Bethesda, Maryland. The NEX was owned by the Department of the Navy. Rodriguez was required to comply with federal wage, hour and records regulations under the Davis-Bacon Act. The Act required subcontractors to pay workers employed at the project site wages determined by the Department of Labor. The Department of Labor determined that the electrician’s prevailing wage rate at the NEX project was $49.88 an hour.
Between August 2011 and June 2012, Rodriguez provided no fewer than 30 electrical workers at the NEX project. Rodriguez, however, listed no more than eight workers on RDZ=s certified payrolls and falsely stated that he paid the workers the prevailing wage. Rodriguez in fact paid his electrical workers between $12 and $20 per hour, and failed to pay them overtime, despite the fact that many worked more than 40 hours a week. Rodriguez did not pay benefits to any of the workers. The certified payrolls, of which he submitted at least 17, also contained other material misstatements regarding the names, wages and hours of RDZ employees performing work. Over the lifespan of the NEX project, the difference between the wages actually paid to RDZ employees and the wages due under the Davis-Bacon prevailing wage rate, exceeded $1 million.
Rodriguez used the social security numbers assigned to another person and to his minor son to open bank accounts for his business and obtain his Maryland driver’s license.
On November 20, 2013, law enforcement executed a search warrant at Rodriguez’s residence and seized numerous fraudulent identification documents, some of which contained his picture and fraudulent identifiers. Law enforcement also seized a revolver and ammunition.
Rodriguez faces a maximum sentence of five years in prison for making a false statement, and 10 years for the illegal possession of a firearm by an alien. Rodriguez has agreed to forfeit funds in two bank accounts, a pick-up truck, $989,969 and a revolver. U.S. District Judge Roger W. Titus scheduled sentencing for October 30, 2014 at 2:30 p.m.
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 Attorney’s 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, demonstrate the Department of Justice's commitment to helping ensure the integrity of the government procurement process.
United States Attorney Rod J. Rosenstein praised the U.S. Department of Labor - OIG, Naval Criminal Investigative Service and Social Security Administration - OIG for their work in the investigation. Mr. Rosenstein thanked Special Assistant United States Attorney Paul Nitze and Assistant United States Attorney Bryan E. Foreman, who are prosecuting the case.