NEW YORK — A Brooklyn plumber has pleaded guilty to charges that he overcharged the Metropolitan Transportation Authority by millions of dollars. Alex Figliolia Contracting Corp. and its principals — Alex Figliolia Sr.; his wife, Janet Figliolia; and his son, Alex Figliolia Jr. — were named in a 116-count indictment in December 2003.
Also indicted were MTA's former director of facility operations and support, Howard Weissman; its former facilities manager, Ronald Allan; and current MTA building manager, Gary Weissbard. The MTA employees were charged with participating in the scheme.
The indictment charged that the defendants were engaged in a criminal enterprise for the purpose of stealing millions of dollars from the MTA through a variety of schemes, including inflating invoices for materials, violating prevailing wage requirements, money laundering, falsifying and forging business records filed with the MTA and evading taxes, said Manhattan District Attorney Robert M. Morgenthau.
The indictment charged that the plumbing firm stole $1,156,679.41 in a prevailing wage scheme by falsely claiming to pay prevailing wages when it paid far less and pocketed the difference. An examination of the books and records maintained by Figliolia Plumbing, seized during the execution of a search warrant at the business on April 15, 2003, showed that Figliolia paid most of its workers less than $20 per hour, and in some cases as little as $8 per hour, but the firm billed the MTA for the prevailing wage of more than $65 per hour.
The indictments also charged that the defendants stole $806,000 by inflating the costs of its materials to Pentagon-like proportions. The indictment said the plumbing firm charged the MTA $135.04 for a 1/4-in. brass tee and charged $337.86 for a 21/2-by-41/2-in. brass nipple.
The Figliolias were charged with money laundering more than $9 million by issuing $5.4 million in corporate checks classified as business expenses to various contractors and retailers. The checks included more than $1 million issued to jewelry retailers and an antique furniture retailer and more than $3.6 million issued to more than 57 contractors who performed work on the Figliolia home in New Jersey.
They were accused of issuing more than $4 million in checks to themselves, all in amounts of less than $10,000 to avoid generating Currency Transaction Reports required by federal law at banks. Tied in with this charge were charges of tax evasion.
Alex Figliolia Sr. and Alex Figliolia Jr. pleaded guilty to the overcharges and inflated invoices and admitted stealing more than $ 1 million. Both men pleaded guilty to enterprise corruption. As part of the plea deal, Figliolia Sr. will serve up to five years and Figliolia Jr. up to eight years. Janet Figliolia pleaded guilty to bribery and will get five years probation. Sentencing is scheduled for Jan. 5, 2005. The Figliolias and their company were ordered to make restitution of $6 million.
All three MTA defendants have pleaded guilty, Morgenthau said, but they have not been sentenced.
"While we may never know exactly how much money was stolen from the MTA, the investigation revealed that one plumbing contractor alone, generated approximately $9.3 million in fraudulent labor charges, inflated invoices for materials, and cash-generating schemes to renovate his house, purchase jewelry, furniture and stock and evade taxes," he said.
From 1994 through 2002, Figliolia Plumbing obtained a series of nine consecutive contracts to provide as needed maintenance and repair services for plumbing operations at a number of MTA locations. It also acted as a subcontractor on other projects.
The plumbing firm was able to carry off the scheme by colluding with and bribing MTA officials, according to court records. Weissman received cash payments, jewelry and free trips totaling about $550,000. Allan, Weissman's chief adviser, received bribes totaling $65,000. Weissbard received $10,000.