In heaven, the streets are paved with gold. On earth, we have to settle for asphalt. One construction company, however, recently tried to get its own a little bit of heaven on earth by overcharging the federal government millions for repaving highways.
The Gohmann Asphalt and Construction Company did not use gold, but it didn’t use the full amount of asphalt it charged the government for, either. When repaving large stretches of highways in Kentucky and Indiana, the company skimped on asphalt and lined their own pockets with the savings.
Paving roads may not be rocket science, but it is important to use the right thickness. Otherwise, the roads deteriorate too quickly. That may be exactly what Gohmann Asphalt was hoping for. If the roads wore out sooner, they would be given millions to repave them more frequently. In any event, Gohmann Asphalt knowingly cheated the motorists and taxpayers.
The government paid the company $99 million for work performed between 1997 and 2006. Approximately 40 percent of the contract price was based upon the thickness of the roads.
The scheme was simple. Whenever the government asked for core samples, Gohmann Asphalt switched thin samples for thick ones taken from other areas. To check thickness, a government highway worker would mark portions of new highways to be tested. The company was supposed to drill a small core hole and measure the thickness of the road at these spots. Whenever the samples were too thin, the company would discard them and replace them with samples from parts of the highway with the right thickness.
The scheme worked well … until a worker could no longer stand being a part of the fraud and stepped forward to report it.
It didn’t take long to prove the fraud. The road was not going anywhere. As soon as the government sent someone to take its own samples, the situation became obvious.
The company agreed to repay the $5.3 million bonus it had received for early completion, plus another $2.9 million, for a total of $8.2 million.
This is not the only time construction companies have cheated the federal government. According to the U.S. Department of Transportation, from 2000 to the present, there have been 234 convictions and over $150 million in fines and restitution recovered relating to fraud against the agency.
Under the False Claims Act, a company that cheats on a federal contract or program is liable to repay up to three times the amount of the fraud. The same statute also contains a whistleblower provision that pays rewards of up to 25 percent to a whistleblower who submits a proper application to initiate the investigation.
In this case of highway fraud, the whistleblower received over $1 million for stepping forward. He not only stamped out fraud, but helped ensure that our roads are not filled with potholes.
This side of heaven we will always have fraud, but that does not mean we have to sit back and take it. If you know of fraud against the government, do what you know is right by reporting it.
