MN Joint Venture Fined for False Claims of DBE Use

According to an August 24, 2011, U.S. Department of Justice press release, Minnesota Transit Constructors Inc. (MnTC), a joint venture comprised of Granite Construction, C.S. McCrossan Inc., and Parsons Transportation Group, as well as a number of subcontractors, have agreed to pay the United States to resolve allegations that the joint venture knowingly submitted false claims related to a federally funded transit construction project in Minneapolis. According to the press release, “the companies falsely claimed that they had used Disadvantaged Business Enterprises (DBEs) for part of the work on the project when they had not.” The joint venture had been the prime contractor on the project to design and build the Hiawatha Light Rail Transit System, a light-rail line linking downtown Minneapolis-St. Paul International Airport and the Mall of America. According to the government, “to obtain and maintain their contract, MnTC and its subcontractors were required to comply with the DBE regulations and to accurately report their DBE contracting. MnTC claimed that materials and services for the project were provided by DBEs, when in fact they were provided by non-DBE subcontractors, and the DBEs were merely extra participants used to make it appear as if a DBE had performed the work.”

Comment