In a first in the state, officials from a "primary contractor" were convicted yesterday of falsely claiming they had hired minority subcontractors to work on a state contract.
The owners of a Baltimore construction company pleaded guilty to fraud yesterday in Anne ArundelCounty Circuit Court.
Assistant Attorney General Lynne A. Battaglia said the Attorney General's Office previously had won criminal convictions against subcontractors who falsely claimed to be minority-controlled. But never before, he said, had the office won convictions against primary contractors obligated under law to make a good-faith effort to hire minoritycompanies as subcontractors.
Yesterday's guilty plea averted whathad been expected to be a four-week trial. Richard O. Taylor and hisbrother, David G. Taylor, owners of F. A. Taylor & Son Inc., and Alfred L. Motlow II, president of Roofex Inc., of Takoma Park, all pleaded guilty to one count of fraudulent concealment.
In exchange, prosecutors said they will place seven other charges against the men on the inactive docket until they are sure the men will not appeal a ruling denying their claim that the state's minority set-aside law is unconstitutional. At that point, the charges will be dropped, Battaglia said.
Charges against Pravat K. Choudhury, Motlow's partner, wereplaced on the inactive docket in exchange for his cooperation with prosecutors, Battaglia said. The two companies also face criminal charges to be addressed at sentencing March 22, Battaglia said.
The men and their companies were indicted in August 1989 on charges of stealing $85,000 from the state, conspiracy and submitting false documents in connection with attempts to win a 1986 roofing repair contract at Baltimore-Washington International Airport under the state's minority set-aside law.
The indictments followed an investigation by state police and the Attorney General's Office into an airport roofing contract with the state Department of Transportation.
A statement of facts presented yesterday by Assistant Attorney General Ben C. Clyburn showed the Taylors' company won the bidding on the airport job and named Roofex Inc., a certified minority firm, as a subcontractor.
But an investigation showed Roofex was busy working on a job in Baltimore City and did not perform the work at the airport, prosecutors said. Attorneys for the state presented paperwork they said showed attempts by Taylor and Roofex to cover up the fraud by falsely documenting the airport work was done by Roofex employees.
Defense lawyersin the case last year challenged the constitutionality of the state's law on set-asides for minority contractors, but Anne Arundel CountyCircuit Judge Warren B. Duckett Jr. upheld the law.
Plea negotiations were conducted throughout the pretrial phase of the case, but anagreement was not reached until last Saturday, Battaglia said.
Under the agreement, attorneys for the state will be free to ask for prison time for the three men. Defense attorneys will also be free to argue for probation before judgment, a ruling which would wipe the conviction off the men's records if they successfully complete their probation.
The maximum penalty for fraudulent concealment is five years in prison and a $20,000 fine. Battaglia said the companies are still in business.