Summary

On February 22, FTA debarred JMG Excavating Co. (JMG), Pottstown, Pennsylvania, for 5 years as a result of the company's May 2006 guilty plea to charges of mail fraud related to fraud involving the Disadvantaged Business Enterprise (DBE) Program on federally-funded transit contracts. Between August 1997 and February 2004, JMG obtained 8 contracts from the Southeastern Pennsylvania Transit Authority (SEPTA) totaling $7.8 million. The contracts required that a portion of the work be done by a DBE-certified subcontractor. JMG paid Pullins Dump Truck, a certified DBE, a 2.5 % fee in exchange for letting JMG bill SEPTA for $1.27 million for DBE-subcontracted work that was actually performed by JMG. In May 2006, JMG was placed on 5 year's probation and was ordered to pay $1,277,152 in restitution. The investigation was conducted with the FBI and with assistance from SEPTA's OIG.