Big Dig contractor charged with lying about quality, overbilling

June 20, 2008 06:08 PM Email| Comments (0)| Text size – +

By Globe Staff

Modern Continental Corp., the largest construction contractor on the Big Dig project, is facing charges that it lied about the quality of the construction work it performed and engaged in a scheme of overbilling the project, federal officials said this afternoon.

The Cambridge-based company "knowingly executed documents" stating that two portions of the project had been built according to specifications when the company was, in fact, aware that they were not, officials from the U.S Attorney's office, the Department of Transportation, the FBI, and the Department of Labor said in a statement.

The statement pointed to two major mishaps in the project. One was a Sept. 15, 2004 blowout in a wall of the Tip O'Neill Tunnel that resulted in extensive traffic delays. Another was the July 10, 2006 collapse of a concrete ceiling panel in the Interstate 90 connector tunnel that killed Milena DelValle, a passing motorist.

"In both instances, MCC was aware at, or near, the time it constructed the slurry walls and installed the tunnel ceiling that it was not adhering to the contract documents," the statement said. But in both cases, the company still knowingly signed "certifications" that the project was built in accordance with the contract.

Modern Continental also allegedly overbilled the project by falsely categorizing apprentice workers as journeymen on a variety of Big Dig Contracts. The scheme allegedly resulted in hundreds of thousands of dollars in overbilling.

The company also faces charges of wire fraud because it received electronic payment for the inadequate work it performed, the statement said.

If convicted of the charges, the company faces criminal fines of up to $500,000 for each of 49 counts of making false statements, submitting phony time and materials slips, and wire fraud -- or $24.5 million in all. Its financial exposure could be even greater if it is forced to pay restitution for its deficient work.

The company said in a statement that the charges were "completely unfounded and without merit."

U.S. Attorney Michael J. Sullivan said that the case was another example of federal officials' commitment to vigorously investigate the project.

"It is critically important that federal and state tax dollars needed to fund important public work projects like the Big Dig are safeguarded against waste, fraud, and corruption. As I have said before, we will leave no stone unturned," he said.