$268M in contracts: Documents shed new light on investigation into alleged fraud by Milwaukee companies
Documents shed new light on investigation into alleged fraud by Milwaukee companies
Documents shed new light on investigation into alleged fraud by Milwaukee companies
MILWAUKEE -- A federal investigation into several Milwaukee businesses is underway. FOX6 News has acquired federal documents that shed new light on this investigation.
The allegation is that several businesses landed around $268 million in government contracts because they claimed to be owned by minorities and disabled veterans.
Government officials say it was all a fraud.
Agents with the Department of Defense, the Department of Veterans Affairs, the U.S. Small Business Administration, the U.S. Army CID and the General Services Administration for the U.S. government were among those on hand on August 3rd -- executing a search warrant at a building near 55th and Florist in Milwaukee.
The search warrants name the contracting companies Nuvo Construction, C3T, Pagasa Construction and the Sonag Company, as well as a local accountant.
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In documents filed in federal court, the alleged crimes range from conspiracy to defraud the United States to money laundering.
Documents allege that to get minority contracts from the government, the Sonag Company approached a former Hispanic worker, who agreed to become president of another company, Nuvo, and that minority worker claimed to manage the company.
Documents show, however, that worker had actually moved to Minnesota, and had another job there.
The search warrant affidavit says the supposed president of the company "was never at Nuvo, despite having an office there."
The allegations are that a similar scheme took place at other related companies to get contracts reserved for disabled veterans.
Federal investigators are looking into possible money laundering -- where companies bought homes and property for the owner and his son and daughter-in-law -- and the allegation that one of the spin-off companies used business funds for personal items like cosmetic surgery, a casino and water ski club.
FOX6 News on Thursday, August 11th stopped by the building that houses most of the businesses named in the search warrant. Two offices were open, but those there had no comment.
Meanwhile, federal officials are going over evidence to prepare for possible charges.