Photo Courtesy of DOI
DOI First Deputy Commissioner Lesley Brovner said this case is about corrupting “the integrity of procurement and minority business enterprise programs for private advantage and profit.”
By Michael V. Cusenza
More than a dozen executives and nine companies, including two owners and one corporation from Queens, were recently indicted for engaging in schemes involving bribery, business fraud, and political campaign contributions, according to City authorities.
In all, 22 defendants are charged in a series of indictments that, according to the Department of Investigation, are the result of a long-term investigation into schemes involving bribery, minority business program fraud, and illegal campaign contributions by construction management companies and high-level executive officers in the industry.
“This investigation highlights how a City employee and contractors corrupted the integrity of procurement and minority business enterprise programs for private advantage and profit,”
According to law-enforcement officials, between 2007 and 2016, Manny Madu, 56, a former mid-level manager at the City Department of Environment Protection, leaked confidential information about millions of dollars in City contracts pertaining to the maintenance of the city’s water system to certain companies and their executive officers during the procurement and bidding process, which gave them a significant competitive edge over other proposers. Over nearly a decade, Madu, a longtime employee who worked for DEP for nearly 20 years in various capacities, passed the confidential information to, among others, Husam Ahmad, 61, a Queens resident who is the chairman and CEO of the engineering and architecture firm HAKS.
Madu, according to charging documents, was rewarded for sharing internal DEP documents, such as scopes of work, schedules for upcoming contracts, non-public cost estimates, and information about individual selection committee members, with the aforementioned companies and executives who, in turn, compensated the defendant with extravagant meals, gifts, hotel stays, Broadway show tickets, employment opportunities for his relatives, charitable donations to organizations he managed, and—most significantly—the award of more than $7.5 million in subcontracts to companies that were affiliated with Madu. These businesses were owned or operated by various members of Madu’s family or close friends, including Shelly Mohan, 52, a borough resident who controlled the South Richmond Hill consulting firm MCMS Associates, LLC—and worked as Madu’s assistant during her time at DEP.
Ahmad, according to authorities, also sought to obtain additional public contracts by gaining control of a company that was certified to participate in the State Minority and Women-Owned Business Enterprise program and its federal counterpart, the Disadvantaged Business Enterprise program. In 2007, Ahmad acquired a 45 percent stake in SIMCO, which was MWBE/DBE-certified. Ahmad, who could not claim personal ownership of more than 50 percent without compromising the company’s MWBE/DBE status, then engaged in a scheme to acquire full control of the company. Working with two intermediaries from HAKS, Ahmad supplied the necessary funds to a former HAKS employee to purchase the remaining 55 percent stake from SIMCO’s founder and assume the title of president, which allowed Ahmad to hide his control of the company.
Additionally, Ahmad allegedly orchestrated a scheme to circumvent City campaign-contribution limits by encouraging HAKS employees to donate to political campaigns and then reimbursing them through year-end bonuses, City officials said.
