Considering that he won't do any prison time, Michael Sewell should consider himself fortunate. On October 30, Sewell, owner-operator of MESCO Inc., a suburban Baltimore HVAC and plumbing contractor, was sentenced in U.S. District Court for the District of Maryland to three years of supervised probation, and ordered to pay $89,222 in restitution, for underreporting hours worked by employees for the purpose of avoiding having to make contributions to International Brotherhood of Electrical Workers-managed benefit plans. Sewell had pleaded guilty in August after being charged in July. The actions follow a joint investigation by the U.S. Labor Department's Office of Labor-Management Standards, Employee Benefits Security Administration and Office of Inspector General.
The case grew out of a February 2012 civil suit filed by Electrical Workers benefit plan trustees, along with IBEW Local 24, accusing the Joppa, Md.-based MESCO, and another firm, Michael Sewell & Associates, of nearly $500,000 wage-and-hour underreporting over a more than four-year period. The purpose was to avoid making benefit contributions, as MESCO was required to do under a collective bargaining agreement in force. As the two companies were interchangeable, they gave all the appearance of an illegal double-breasting scheme whereby a union contractor sets up a parallel identical nonunion firm. This past February a federal court ruled that MESCO and Sewell & Associates were liable for $453,615.98 in contributions, interest and damages, a figure representing more than 90 percent of the amount sought by the plaintiffs. A DOL probe and a Justice Department criminal action followed.
Related:
Maryland Building Contractor Pleads Guilty to IBEW Benefits Fraud
IBEW Contractor in Maryland Charged with Benefits Fraud
