Owner And Senior Executive Of New York Contracting Company Charged For Paying Bribes To Obtain Construction Contracts From A Fortune 500 Company

Press Release Owner And Senior Executive Of New York Contracting Company Charged For Paying Bribes To Obtain Construction Contracts From A Fortune 500 Company Thursday, December 14, 2023 Share FacebookLinks to other government and non-government sites will typically appear with the “external link” icon to indicate that you are leaving the Department of Justice website when you click the link. XLinks to other government and non-government sites will typically appear with the “external link” icon to indicate that you are leaving the Department of Justice website when you click the link. LinkedInLinks to other government and non-government sites will typically appear with the “external link” icon to indicate that you are leaving the Department of Justice website when you click the link. Email For Immediate Release U.S. Attorney's Office, Southern District of New York Damian Williams, the United States Attorney for the Southern District of New York, announced today the unsealing of charges against TROY CARUSO, the owner and chief executive officer of a commercial construction and contracting company headquartered in New York, New York (the “Contracting Company”), and JOHN NOLAN, a senior executive at the Contracting Company, for their participation in a scheme to bribe a senior project manager at a Fortune 500 real estate services firm in order to obtain contracting work. CARUSO was arrested this morning in Melville, New York, and NOLAN was arrested this morning in Brooklyn, New York. Both CARUSO and NOLAN are expected to be presented in federal court in Manhattan later today. U.S. Attorney Damian Williams said: “As alleged, Troy Caruso and John Nolan bribed a senior-level individual at a Fortune 500 company to award their company favorable contracts, resulting in the parties involved fraudulently obtaining millions. In the construction world, fair bidding is crucial to the success or downfall of a business, and kickback schemes like the one we allege in this case can undermine that process. Those attempting to corrupt the bidding process by gaining an unfair advantage over their law-abiding counterparts will face criminal prosecution.” According to the allegations in the Indictment:[1] From at least in or about February 2021, up to and including in or about September 2023, CARUSO and NOLAN agreed to pay and did pay kickbacks to an employee of a global and publicly traded commercial real estate services company (the “Real Estate Firm”) in exchange for assistance and preferential treatment so that the Contracting Company would be awarded projects managed by the Real Estate Firm (the “Kickback Scheme”). In or about March 2021, CARUSO and NOLAN were introduced by an individual (“CC-1”) to a senior project manager at the Real Estate Firm (“CC-2”). CC-2 managed the process by which contracting companies bid for and were awarded contracts to work on construction projects for various of the Real Estate Firm’s clients. Beginning in or about March 2021 because of the Kickback Scheme, CC-2 took a series of actions CC-2 otherwise would not have taken to ensure that the Contracting Company was awarded a pre-construction contract and a construction contract relating to a certain project (“Project-1”), which was managed by the Real Estate Firm on behalf of its client, a health services business that provides hospital, medical, and other health services to patients. For example, CC-2 ensured that the Contracting Company was on the Real Estate Firm’s “bid list” so that it could submit bids relating to Project-1 that it otherwise could not have submitted. CC-2 also provided non-public information to CARUSO and NOLAN about the bidding process and recommended the Contracting Company for both the pre-construction contract and the construction contract relating to Project-1. As a result of the Kickback Scheme and CC-2’s actions, the Contracting Company was awarded the pre-construction and construction contracts for Project-1, the latter of which was valued at approximately $3.55 million (to be paid to the Contracting Company). In exchange for CC-2’s assistance and preferential treatment, CARUSO and NOLAN agreed to pay kickbacks to CC-2 in the amount of approximately one percent of the construction value of any project managed by the Real Estate Firm that resulted in a contract award to the Contracting Company. Accordingly, CARUSO and NOLAN agreed to pay CC-2 approximately $35,500 for Project-1 and ultimately paid CC-2 approximately $33,000 in kickbacks for CC-2’s assistance on Project-1. Most of these payments were made in cash at locations around New York City. CARUSO and NOLAN also paid CC-1 approximately $15,000 for CC-1’s assistance in the Kickback Scheme, which included connecting CC-2 with CARUSO and NOLAN. CARUSO and NOLAN attempted to obtain additional contracts from the Real Estate Firm with CC-2’s assistance as part of the Kickback Scheme. Between in or about 2022 and in or about 2023, in exchange for CARUSO and NOLAN’s promise of payment for any contract awarded to the Contracting Company, CC-2 provided CARUSO and NOLAN with assistance relating to two additional construction projects managed by the Real Estate Firm that did not result in contract awards to the Contracting Company. * * * CARUSO, 56, of Smithtown, New York, and Ludlow, Vermont, and NOLAN, 42, of Brooklyn, New York, are each charged with one count of conspiracy to commit honest services wire fraud and one count of honest services wire fraud, which each carry a maximum sentence of 20 years in prison. The statutory maximum penalties are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants would be determined by a judge. Mr. Williams praised the outstanding investigative work of the Special Agents and the Task Force Officers of the U.S. Attorney’s Office for the Southern District of New York. Mr. Williams also thanked the Federal Bureau of Investigation for their assistance in the investigation. This case is being handled by the Office’s Public Corruption Unit. Assistant U.S. Attorneys Jane Kim and Nicholas Folly are in charge of the prosecution. The charges contained in the Indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty. [1] As the introductory phrase signifies, the entirety of the text of the Indictment and the description of the Indictment set forth herein constitute only allegations, and every fact described should be treated as an allegation. Contact Nicholas Biase (212) 637-2600 Updated December 14, 2023 Attachment indictment_23_cr._654_us_v._caruso_and_nolan_filed.pdf [PDF, 380 KB] Topic Financial Fraud Component USAO - New York, Southern Press Release Number: 23-428

Press Release Owner And Senior Executive Of New York Contracting Company Charged For Paying Bribes To Obtain Construction Contracts From A Fortune 500 Company Thursday, December 14, 2023 Share FacebookLinks to other government and non-government sites will typically appear with the “external link” icon to indicate that you are leaving the Department of Justice website when you click the link. XLinks to other government and non-government sites will typically appear with the “external link” icon to indicate that you are leaving the Department of Justice website when you click the link. LinkedInLinks to other government and non-government sites will typically appear with the “external link” icon to indicate that you are leaving the Department of Justice website when you click the link. Email For Immediate Release U.S. Attorney's Office, Southern District of New York Damian Williams, the United States Attorney for the Southern District of New York, announced today the unsealing of charges against TROY CARUSO, the owner and chief executive officer of a commercial construction and contracting company headquartered in New York, New York (the “Contracting Company”), and JOHN NOLAN, a senior executive at the Contracting Company, for their participation in a scheme to bribe a senior project manager at a Fortune 500 real estate services firm in order to obtain contracting work. CARUSO was arrested this morning in Melville, New York, and NOLAN was arrested this morning in Brooklyn, New York. Both CARUSO and NOLAN are expected to be presented in federal court in Manhattan later today. U.S. Attorney Damian Williams said: “As alleged, Troy Caruso and John Nolan bribed a senior-level individual at a Fortune 500 company to award their company favorable contracts, resulting in the parties involved fraudulently obtaining millions. In the construction world, fair bidding is crucial to the success or downfall of a business, and kickback schemes like the one we allege in this case can undermine that process. Those attempting to corrupt the bidding process by gaining an unfair advantage over their law-abiding counterparts will face criminal prosecution.” According to the allegations in the Indictment:[1] From at least in or about February 2021, up to and including in or about September 2023, CARUSO and NOLAN agreed to pay and did pay kickbacks to an employee of a global and publicly traded commercial real estate services company (the “Real Estate Firm”) in exchange for assistance and preferential treatment so that the Contracting Company would be awarded projects managed by the Real Estate Firm (the “Kickback Scheme”). In or about March 2021, CARUSO and NOLAN were introduced by an individual (“CC-1”) to a senior project manager at the Real Estate Firm (“CC-2”). CC-2 managed the process by which contracting companies bid for and were awarded contracts to work on construction projects for various of the Real Estate Firm’s clients. Beginning in or about March 2021 because of the Kickback Scheme, CC-2 took a series of actions CC-2 otherwise would not have taken to ensure that the Contracting Company was awarded a pre-construction contract and a construction contract relating to a certain project (“Project-1”), which was managed by the Real Estate Firm on behalf of its client, a health services business that provides hospital, medical, and other health services to patients. For example, CC-2 ensured that the Contracting Company was on the Real Estate Firm’s “bid list” so that it could submit bids relating to Project-1 that it otherwise could not have submitted. CC-2 also provided non-public information to CARUSO and NOLAN about the bidding process and recommended the Contracting Company for both the pre-construction contract and the construction contract relating to Project-1. As a result of the Kickback Scheme and CC-2’s actions, the Contracting Company was awarded the pre-construction and construction contracts for Project-1, the latter of which was valued at approximately $3.55 million (to be paid to the Contracting Company). In exchange for CC-2’s assistance and preferential treatment, CARUSO and NOLAN agreed to pay kickbacks to CC-2 in the amount of approximately one percent of the construction value of any project managed by the Real Estate Firm that resulted in a contract award to the Contracting Company. Accordingly, CARUSO and NOLAN agreed to pay CC-2 approximately $35,500 for Project-1 and ultimately paid CC-2 approximately $33,000 in kickbacks for CC-2’s assistance on Project-1. Most of these payments were made in cash at locations around New York City. CARUSO and NOLAN also paid CC-1 approximately $15,000 for CC-1’s assistance in the Kickback Scheme, which included connecting CC-2 with CARUSO and NOLAN. CARUSO and NOLAN attempted to obtain additional contracts from the Real Estate Firm with CC-2’s assistance as part of the Kickback Scheme. Between in or about 2022 and in or about 2023, in exchange for CARUSO and NOLAN’s promise of payment for any contract awarded to the Contracting Company, CC-2 provided CARUSO and NOLAN with assistance relating to two additional construction projects managed by the Real Estate Firm that did not result in contract awards to the Contracting Company. * * * CARUSO, 56, of Smithtown, New York, and Ludlow, Vermont, and NOLAN, 42, of Brooklyn, New York, are each charged with one count of conspiracy to commit honest services wire fraud and one count of honest services wire fraud, which each carry a maximum sentence of 20 years in prison. The statutory maximum penalties are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants would be determined by a judge. Mr. Williams praised the outstanding investigative work of the Special Agents and the Task Force Officers of the U.S. Attorney’s Office for the Southern District of New York. Mr. Williams also thanked the Federal Bureau of Investigation for their assistance in the investigation. This case is being handled by the Office’s Public Corruption Unit. Assistant U.S. Attorneys Jane Kim and Nicholas Folly are in charge of the prosecution. The charges contained in the Indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty. [1] As the introductory phrase signifies, the entirety of the text of the Indictment and the description of the Indictment set forth herein constitute only allegations, and every fact described should be treated as an allegation. Contact Nicholas Biase (212) 637-2600 Updated December 14, 2023 Attachment indictment_23_cr._654_us_v._caruso_and_nolan_filed.pdf [PDF, 380 KB] Topic Financial Fraud Component USAO - New York, Southern Press Release Number: 23-428