Suit Alleges Guard Smuggling At Border, Army Accomplice
Law360 (December 8, 2020, 11:07 PM EST) –
Two security contractors have filed a wide-ranging lawsuit alleging a border-smuggling operation involving armed guards and a bill-padding scheme at a pair of firms responsible for construction of the U.S.-Mexico border wall.
The False Claims Act lawsuit alleges that two Texas-based contractors, in conjunction with an unnamed employee at the U.S. Army Corps of Engineers, helped shuttle in armed guards from Mexico to provide security at border-wall construction sites. The firms then fired the unnamed plaintiffs for refusing to cover up the operation, according to the suit, filed in February but unsealed last week.
“Defendants violated the FCA by … knowingly permitting the use of unvetted workers in sensitive and lightly secured areas in the immediate vicinity of the U.S.-Mexico border, and making false claims and representations regarding the same,” according to the suit, which was first reported by The New York Times.
The plaintiffs, one a former FBI special agent, say they were hired to perform security-related services on border-construction projects overseen by Sullivan Land Services Co. and its subcontractor, Ultimate Concrete LLC. Ultimate Concrete is alleged to have cleared a dirt road between the U.S. and Mexico in order to facilitate the smuggling operation, while senior officials at both firms allegedly knew about the scheme.
The other plaintiff, a former deputy sheriff, says he learned during his employment as a security manager for Sullivan’s San Diego border project that there was an “inappropriate relationship” between a supervising Corps official and the president of Ultimate Concrete. This relationship “seemingly involved corrupt payments and potential bribery,” according to the suit. The Corps employee, who was said to have resigned in late 2019, is accused of leveraging his position to bury evidence of impropriety at the border-wall construction sites.
Jesse Guzman, listed on a government contracting database as Ultimate Concrete’s president, did not return multiple phone calls or an emailed request for comment.
Liz Rogers, a spokesperson for Sullivan, said that the lawsuit “is based on inaccurate and untrue allegations.” She added that “the government reached the same conclusion,” but she did not respond to a follow-up question seeking clarification.
At a July 2019 meeting recounted in the lawsuit, the Corps employee turned around and smiled at the Ultimate Concrete president after a participant remarked that the Corps employee “takes [a] cut.” Both plaintiffs say they understood the move to be confirmation of a bribery relationship, suspicions that were supported through conversations with other employees.
In response to Law360’s request, a Corps spokesperson declined to comment on the allegations in the lawsuit.
“The whistleblower complaint was not made to the U.S. Army Corps of Engineers,” the spokesperson said. “The U.S. Department of Justice is responsible for reviewing the complaint and determining any United States involvement.”
In one conversation the suit describes as an “intimidation tactic,” the former deputy sheriff says the Corps employee chastised him for reporting to the Corps a shooting involving the alleged Mexican guards. The incident was “none of our concern,” the employee allegedly said.
The former deputy further alludes to communications with Ultimate Concrete employees that led him to believe the border-wall projects were bilking the government. According to the lawsuit, one employee of the firm volunteered that Ultimate Concrete “was involved in seemingly large-scale fraud and overcharging, including the making of false claims.”
The Ultimate Concrete employee was said to have confessed to the former deputy the firm’s alleged practice of submitting false expenses for diesel fuel.
“You think we’re going to [use] that many gallons?” the employee allegedly remarked.
Last week, the U.S. Attorney’s Office for the Southern District of California declined to step in for the plaintiffs in the case, a procedural move that would have indicated the government is interested in devoting its full resources to the litigation. A spokesperson for that office declined to comment.
Intervention by the U.S. Department of Justice is discretionary, and the agency notes that fewer than 25% of qui tam lawsuits result in the federal government’s intervention. However, the DOJ says that, absent its intervention, FCA cases “usually, but not always,” end up with a dismissal.
Counsel information for the companies was not immediately available.
The case is U.S. ex rel. John Doe 1 and John Doe 2 v. Sullivan Land Services Co. et al., case number 3:20-cv-00223-BAS-MDD, in the U.S. District Court for the Southern District of California.
–Editing by Breda Lund.
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