Kevin Hicks, 43, the former Chief Financial Officer for Boggs Paving Inc., has pleaded guilty to his participation in an $87 million fraud scheme involving government funded construction projects. Hick is one of six participants who have been indicted in the “massive” government fraud that involved a decade of state and federal road projects.
According to court documents, Boggs Paving received 37 federally funded projects worth an estimated $87.6 million dating back as far as 2004. The company wouldn’t have received these contracts without falsely claiming that minority sub-contractors, disadvantaged business enterprises (DBEs), would receive a required percentage of the work. To conceal the fraud and make it appear as if Styx Cuthbertson Trucking Company, Inc. was doing and being paid for the necessary work, the conspirators ran payments through a nominee bank account in Styx’s name, and then funneled the money back to Boggs Paving and its affiliates. Prosecutors also believe that the owner of Styx, John Cuthbertson, received kickbacks for allowing his company’s name and DBE status to be used by Boggs Paving.
Hicks has been released on bond and will be sentenced at a later date. He faces penalties that include up to 25 years in prison and fines up to $750,000. Arnold Mann, a former project manager for the company, pleaded guilty to conspiracy to commit wire fraud and mail fraud charges last month. Prosecutors expect the former company vice president, Greg Tucker, to plead guilty today to one count of conspiracy to defraud the highway department. All three men are expected to cooperate in the ongoing investigation against their company.
This case was investigated by the United States Department of Transportation-Office of Inspector General, the Federal Bureau of Investigation, and the Internal Revenue Service. Assistant United States Attorneys Jenny G. Sugar and Michael E. Savage handled the prosecution.
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