WTC Memorial Construction Management Company 'Scheme' Cost Taxpayers Hundreds of Thousands

Company pays $1.6M to settle claims it submitted bogus time sheets, padded employee payroll records on NYC projects

By Scott MacFarlane
|  Thursday, Sep 12, 2013  |  Updated 9:43 AM EDT
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The company managing construction of the World Trade Center memorial in New York has admitted submitting bogus time sheets and padding employee payroll records to the government, including for work on the World Trade Center memorial site, according to documents obtained by the News4 I-Team.

Scott MacFarlane

The company managing construction of the World Trade Center memorial in New York has admitted submitting bogus time sheets and padding employee payroll records to the government, including for work on the World Trade Center memorial site, according to documents obtained by the News4 I-Team.

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WTC Memorial Construction Management Company 'Scheme' Cost Taxpayers Hundreds of Thousands

The company managing construction of the World Trade Center memorial in New York has admitted submitting bogus time sheets and padding employee payroll records to the government, including for work on the World Trade Center memorial site, according to documents obtained by the News4 I-Team.
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The company managing construction of the World Trade Center memorial in New York has admitted submitting bogus time sheets and padding employee payroll records to the government, including for work on the World Trade Center memorial site, according to documents obtained by the News4 I-Team.

The company, Lend Lease, is an industry giant with offices worldwide and a portfolio including $360 million in projects in the Washington, D.C., area and a series of projects in New York City, according to its website.

Federal documents, obtained exclusively by the News4 I-Team, detail what prosecutors describe as a years-long “scheme” by Lend Lease, which cost taxpayers at least hundreds of thousands of dollars. An audit memo from the U.S. Department of Housing and Urban Development Inspector General says Lend Lease “permitted union foremen to add to timesheets and paid union foremen 1 or 2 hours per day of overtime, regardless of whether foremen worked those hours.”

The federally funded projects were underway from 2000 to 2009, prosecutors said.

Federal prosecutors filed a civil lawsuit against Lend Lease this year in U.S. District Court for the Southern District of New York alleging improprieties in the company’s work on multiple federal projects in New York, including the World Trade Center memorial. Prosecutors, in their formal complaint, said the company allowed “certain foremen to be absent from work for sick days, major holidays, and an additional one or two weeks of vacation per year, while (Lend Lease) completed and submitted time sheets to its clients as though the labor foreman had worked those days.”

A company attorney signed a settlement agreement in February acknowledging improprieties. In a statement, Lend Lease senior vice president Mary Costello said, “The activity in question relates to allegations in the NYC construction industry dating back several years. The company cooperated fully with (the Southern District of New York) and has paid the settlement amount and now maintains one of the most rigorous compliance programs in the industry.”

Settlement records, obtained by the News-4 I-Team show the settlement amount was $1,616,586.

Nancy Aronson, whose sister-in-law Myra Aronson was killed aboard American Airlines Flight 11 at the North Tower of the World Trade Center on 9/11, told the I-Team the case “dishonored” the memorial site.

“Billing taxpayers for phantom costs and charges is bad enough, doing it on the 9/11 project is an extra layer of deceit and sadness,” said David Williams of the Washington, D.C.-based Taxpayers Protection Alliance.

Lend Lease continues to serve as construction manager of the World Trade Center memorial site. Federal prosecutors agreed to “release” the company’s current and former officers from “any civil or administrative” claims as part of its settlement agreement with Lend Lease.

Lend Lease’s website lists a series of projects in the Washington, D.C., region, including facilities for Montgomery College and a Carroll County hospital in Maryland.

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