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The owner of a Dravosburg-based contracting company pleaded guilty in federal court to conspiracy to defraud the U.S. government, Acting U.S. Attorney Soo C. Song said today.
Donald R. Taylor, 78, of Eighty-Four, Washington County, entered the plea before U.S. District Judge Nora Barry Fischer in Pittsburgh.
Taylor, the owner of Century Steel Erectors Co., testified in court that he conspired with Watson L. Maloy Jr., 77, of Union Twp., Washington County, to use Maloy’s company, W.M.C.C. Inc., as a "front" company to illegally obtain federally funded subcontracts on bridge projects being completed for the state Department of Transportation and the Pennsylvania Turnpike Commission.
W.M.C.C. qualified for certain government jobs because it was a minority-owned small business, federal prosecutors said. Century Steel Erectors was not.
Taylor testified in court that W.M.C.C. and CSE fraudulently obtained nine PennDOT subcontracts between approximately January 2012 and February 2014, resulting in payments to W.M.C.C. totaling more than $1 million.
In return, federal prosecutors said, Taylor admitted that Maloy was paid a periodic “fee" ranging from $2,000 to $10,000 on each job.
Although W.M.C.C. --- as a disadvantaged business enterprise --- was supposed to be completing the jobs, prosecutors said, Century employees actually identified, bid, negotiated, and performed the work on the subcontracts.
To conceal the company's role, Century employees used magnetic signs to cover Century logos on vehicles, had W.M.C.C. business cards printed, and used W.M.C.C. email accounts and phone lines. They also represented themselves as W.M.C.C. employees during meetings with general contractors and PennDOT and Turnpike Commission officials.
In fact, according to the U.S. Department of Transportation's Office of Inspector General, W.M.C.C. actually "failed to perform a commercially useful function."
Maloy previously pleaded guilty to one count of conspiracy to defraud the United States in 2014, and his sentencing is currently scheduled for Jan. 23 before Chief U.S. District Judge Joy Flowers Conti, Song's office said in a prepared statement.
In 2015, W.M.C.C. was permanently banned from bidding on PennDOT contracts.
As part of his guilty plea, Taylor has agreed to pay restitution in the amount of $85,221.21 to PennDOT, officials said.
Taylor is scheduled to be sentenced at 9 a.m. March 9 before Fischer. The law provides for a maximum sentence of five years in prison, a fine of $250,000, or both.
Assistant U.S. Attorneys Robert S. Cessar, Eric G. Olshan and Christy Chriswell Wiegand are prosecuting the case on behalf of the government, Song said. The case was investigated by the FBI and the Office of the Inspector General of the U.S. Department of Transportation, with assistance from the state Turnpike Commission's Office of Inspector General.
Originally published October 30, 2017.