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Jan
2016
27

Couple Faces 20+ Years in Jail, $500,000 Fine for Scheme to Defraud LiUNA! Benefit Fund

Air Quality Experts fraud

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A New Hampshire couple has been arrested for their role in a “double breasted shop scheme” which defrauded the Massachusetts Laborers Benefit Fund of more than $2 million.  

Christopher and Kimberly Thompson face 18 counts of mail fraud, 18 counts of filing false documents with an ERISA fund, and one count of benefit fund embezzlement.

The married couple owned an asbestos removal business, Air Quality Experts, Inc., as well as a second entity named AQE, Inc. which was used to perpetrate the fraud.  A “double breasted shop” scheme is when a business enters into a collective bargaining agreement with a union while simultaneously seeking to avoid its contractual obligations by operating an alter ego non-union company.  The company entered into agreements with the Laborers International Union of North America (LiUNA!) Local 1421.

The details of the scheme were explained in a statement from the United States Attorney’s Office for the District of Massachusetts:

According the indictment, the Thompsons employed members of Tewksbury Local 1421 of the Laborers International Union of North America.  The Thompsons allegedly paid members of Local 1421 for jobs which required union participation from the AQE, Inc. payroll which was a union signatory corporation.  When the jobs did not require a union signatory company, the Thompsons paid the union members from the Air Quality Experts, Inc. payroll.  

In these instances, the union members did not receive union rates, and benefits were not paid by the Thompsons to the MLBF which provides medical and pension benefits to 8,000 laborers and their families in Massachusetts.  The Thompsons allegedly sent “remittance reports” to the MLBF which failed to report thousands of hours worked by members of Local 1421.  By significantly under reporting the hours worked by union members, the Thompsons failed to pay over $2 million to the MLBF.

The couple faces a maximum of 20 years in prison on the fraud charges, three years of supervised release, and a fine of $250,000 or twice the loss or gain from the offense.  The charges of benefit fund embezzlement and corresponding false statements carry a sentence of no more than 5 years in prison, three years of supervised release, and a fine of $250,000 or twice the loss or gain from the offense.  

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