The Justice Department announced last week that a business owner who falsely represented his company as owned and controlled by a service-disabled veteran was convicted of that crime. In this case, the "rent-a-vet" was the owner's own father-in-law who was disabled alright, but was in no condition to exert even a nominal amount of management responsibilities, much less 51 percent.
Stanley Raass of Utah, a former BYU football player, owned a construction company that provided general construction for the Federal Government. In 2009, he formed another company called RWT, named after his father-in-law's initials. Raass' father-in-law is a veteran with a 100 percent disability rating and was listed as the president and majority owner of RWT. Investigators however found that the father-in-law was physically incapable of manging RWT.
To meet SDVOSB requirements and be eligible for contracts set-aside for SDVOSBs, companies must be a small business and more than 50 percent owned by a service-disabled veteran, and daily operations of the business must be managed and controlled by the service-disabled veteran.
Raass represented that RWT was owned 51 percent by his father-in-law and 49 percent by himself. In reality, it was Raass himself that controlled the managerial and daily business operations of RWT. Ultimately, he was able to secure more than $16 million in construction contracts that should have gone to legitimate SDVOSBs.
Raass is expected to serve 24 months in prison and pay $640,000.
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