Following a 13-day trial, in December of 2015 a jury convicted two individuals – Ricky Anthony Lanier, and his wife Katrina Reshina Lanier, 43 – both of LaGrange, N.C., of conspiracy to commit wire fraud, wire fraud, and major fraud against the United States.
Sentencing is set for June 2016, in U.S. District Court. Ricky Lanier faces a possible sentence of up to 60 years in prison and $1 million in fines; while Katrina Lanier faces a possible sentence of up to 50 years in prison and $750,000 in fines. The Laniers agreed to forfeit their interests in approximately $170,000 in funds seized from bank accounts as well as five houses purchased with proceeds of the fraud.
According to the evidence presented at trial, the Laniers conspired from November 2005 to April 2013 to defraud the United States government through a scheme to fraudulently obtain federal contracts intended to be awarded to businesses lawfully participating in the Department of Veterans Affairs’ (VA) Service-Disabled Veteran-Owned Small Business (SDVOSB) program and the Small Business Administration’s (SBA) 8(a) Business Development program.
Ricky Lanier, who had previously owned and operated an 8(a) business receiving government contracts, became ineligible to participate in the 8(a) program after that business graduated from the 8(a) program in 2008. Lanier used a friend and service-disabled veteran as the purported owner of Kylee Construction, representing that the friend was involved in the daily management of the business, even while the friend was working for a government contractor in Afghanistan.
Also, the Laniers used a business owned by Ricky Lanier’s college roommate, JMR Investments, as a front to obtain construction contracts from the National Park Service and other federal agencies under the 8(a) program, misrepresenting the friend’s involvement in the management and operation of the business. The scheme involved sub-contracting out all or almost all of the work on the contracts in violation of program requirements.
As a result of the false representations, Kylee Construction was awarded over $5 million in government contracts and JMR Investments was awarded over $9 million in government contracts, to include contracts for construction at the VA Medical Center at Mountain Home, Tenn., and in the Great Smoky Mountains National Park. The Laniers received almost $2 million in financial benefit from the scheme, using accounts of the shell companies for payment of personal expenses.
Nancy Harr, Acting U.S. Attorney for the Eastern District of Tennessee said, “The integrity of the Service-Disabled Veteran-Owned Small Business program is vital to its continued success. The U.S. Attorney’s Office will aggressively pursue and prosecute those who attempt to defraud that federal program and therefore the United States.”
How sad! Imagine how many tax dollars were spent pursuing prosecution, as well as how many years spent by the relevant investigating bodies. And think of this – while this is framed as an example of justice, many fraudulent companies slip through the cracks. It’s generally only when a contracting officer smells something rotten that a company falls under scrutiny; after all, a call to the VA’s Office of Inspector General hotline alleging procurement fraud does not often result in criminal prosecution.
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Also, to my faithful readers, I do apologize that I missed a week of blogging! I’m also a professional writer, and I needed the time last week to complete edits to my debut novel and create my website. I’ll catch up on other January items next week.
I’m glad that they were finally given their due in court! 🙂