Two Topeka businessmen are named in a $352 million small business fraud scheme that spans nearly 10 years.
Matt Torgeson and Matthew McPherson teamed up with others to fraudulently obtain government contracts set aside for minority and disabled military veteran contractors, prosecutors said in federal court documents obtained by KSNT News. The men are presidents of Torgeson Electric Company and McPherson Contractors, both decades old businesses based in Topeka.
Prosecutors said Torgeson and McPherson conspired with Michael Patrick Dingle, of Missouri, to create “Rent-A-Vet” and “Rent-A-Minority” companies to gain more than 60 fraudulent government contracts for their own benefit since 2009. None of the men are minorities or veterans.
Court documents claim the men used minority veterans to bid for and obtain the work through businesses named Zieson Construction Company and Simcon Corp, then passed the money through to themselves or their businesses.
Federal laws require a portion of federal contracts to be set aside for disadvantaged veterans and minorities, and minority and disabled veteran contractors are required to manage and control the day-to-day operations and long-term decisions for the business. The government said Dingle manages Zieson and Simcon.
“In order to disguise their involvement with Zieson and Simcon, Torgeson, McPherson and Dingle did not receive wages, but instead used their entities to acquire proceeds from these businesses to which they were not entitled,” prosecutors said.
Prosecutors said a third company, Onsite, was new to the scheme, and they anticipated it would be used in the same manner as Zieson and Simcon.
Mason Wilder, a research specialist for the Association of Certified Fraud Examiners in Austin, Tex. said it’s more common than you might think.
“There’s a whole lot of opportunities to take advantage of those systems and it’s something that happens all too frequently,” he said.
A criminal investigation is being conducted into the scheme, according to court documents.
Matt Torgeson responded to our requests for comment by email, saying “We will continue to corporate (sic) with the (Department of Justice) and defend our position if necessary regarding this on going investigation.”
A secretary at McPherson Contractors said Matthew McPherson was out of town and unavailable to comment. Bill Sims, the chief operating officer of McPherson Contractors told KSNT News, “McPherson is a company committed to serving our clients and community with the highest degree of honesty and integrity.” The statement went on to say, “We are working closely with authorities and are taking appropriate measures to aid them.”
KSNT News’ attempts to reach Dingle have been unsuccessful.