In December 2017, the owner of United Medical Design Builders LLC, Mr. Joseph Dial Jr., a service-disabled, veteran, was charged by the Justice Department with fraudulently obtaining contracts intended for service-disabled veteran-owned businesses. It seems that he didn't really run the company but was just a figure-head for a co-conspirator, Troy Bechtel in a classic "rent-a-vet" scheme. Mr. Dial pleaded guilty for his part in the scheme in May 2018 and is set to be sentenced next week (January 28th).
Last week, the shoe dropped for Mr. Bechtel, the man who really ran the company. The Justice Department has charged him with two counts of major program fraud against the United States and two counts of lying to Federal investigators.
The threshold marking the difference between "fraud" against the United States and "major fraud" against the United States is $1 million. The distinction is important in the amount of fines that can be imposed for offenses against the Government. Under the "major fraud" provisions (18 USC 1031), maximum fines can be as high as $10 million, though its doubtful that maximum fines are often levied.The indictment alleges that from 2009 to 2013, Mr. Bechtel aided and abetted other persons unlawfully to obtain more than $12.7 million (some news articles reported $40 million) from Defense contracts. The indictment further alleges that Mr. Bechtel falsely represented that United Medical Design Builders (UMDB) was controlled by Mr. Dial, a disabled veteran. In fact, UMDB was a pass-through company that Mr. Dial did not control. Mr. Bechtel ran the daily operations and made project decisions without reporting to or consulting with Mr. Dial.
Witnesses in the Federal Grand Jury probe testified that Mr. Dial was rarely in the office during the four years they worked for UMDB and the few times he did show up, it was only for a few minutes. Witnesses also testified that Mr. Dial signed a blank sheet of paper that was scanned and used for official letters and correspondence.
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