Wisconsin Man Sentenced to 78 Months for Fraud Scheme Involving Over $260 Million in Small Business

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Wisconsin Man Sentenced to 78 Months for Fraud Scheme Involving Over $260 Million in Small Business Contracts


United States Attorney Matthew D. Krueger announced that on December 16, 2019, Brian L. Ganos of Muskego, Wisconsin, was sentenced by the Honorable Pamela Pepper to 78 months in federal prison for leading a 12-year fraud scheme involving over $260 million in government-funded contracts intended to benefit small businesses. The sentence also includes two years of supervised release, a $5,000 fine, and forfeiture of assets worth nearly $4 million. Ganos had earlier pleaded guilty to one count of wire fraud and one count of mail fraud. Four other individuals and one corporation have also pleaded guilty to a felony charge in connection with Ganos’s scheme.

The scheme involved operating three construction companies with straw owners who qualified as a disadvantaged individual or as a service-disabled veteran, but who did not actually control the companies. Ganos then fraudulently obtained small business program certifications to win government-funded contracts to which the companies were not entitled. Specifically,

• Nuvo Construction Company, Inc. (“Nuvo”) was misrepresented to be majority-owned and controlled by J.L. in order to obtain certifications as a Small Disadvantaged Business from the U.S. Small Business Administration (SBA) and as a Disadvantaged Business Enterprise (DBE) from Milwaukee County. In reality, J.L. worked full-time for a different entity in Minnesota and did not actually control Nuvo.

• C3T, Inc. was misrepresented to be majority owned and controlled by T.A. to obtain verification as a Service-Disabled Veteran-Owned Small Business. In reality, for long stretches, T.A. had virtually no involvement in C3T.

• Pagasa Construction Company, Inc. was misrepresented to be majority owned and controlled by O.M. in order to obtain certification as a Small Disadvantaged Business from the SBA. In reality, O.M. relied on the assistance of Ganos-controlled companies to form Pagasa.

The scheme continued from 2004 to mid-2016 during which period, Ganos and others used those certifications to obtain over $260 million in federal, state, and local contract payments. These included federal construction contracts that were set aside for Small Disadvantaged Businesses or Service-Disabled Veteran-Owned Small Businesses. In addition, Nuvo used its DBE certification to win ready-mix concrete contracts based on the false representation that Nuvo provided ready-mix concrete independently when, in truth, Nuvo’s concrete operations depended heavily on Sonag Ready Mix. On multiple occasions, the conspirators engaged in efforts to conceal the scheme and obstruct investigations into the matter.

As a result of the scheme, Ganos undermined the small business programs and deprived honest small businesses of opportunities to become established. In addition, Ganos used various means to launder proceeds of the fraud scheme and enrich himself. As part of his plea agreement, Ganos agreed to the forfeiture of various assets, including (a) over $1.9 million seized from accounts; (b) a ski condominium in Winter Park, Colorado; (c) the office building in Milwaukee used to facilitate the scheme; (d) two Disney timeshares; (e) and five vehicles, including a Corvette Stingray Convertible and classic cars.

Read more: https://www.justice.gov/usao-edwi/pr/wisconsin-man-sentenced-78-months-fraud-scheme-involving-over-260-million-small