Illinois company settles fraud claim involving contracts

EAST ST. LOUIS, Ill. (AP) - A southern Illinois construction company has agreed to pay back $400,000 to settle a federal complaint accusing it of fraudulently accepting $8 million worth of contracts reserved for disadvantaged small businesses, federal prosecutors say.

R&W Builders agreed to repay the money in a civil settlement to resolve allegations that it violated the False Claims Act, the U.S. Attorney's Office said in a news release.

The allegations were raised against the O'Fallon company during a federal investigation and no criminal complaint was filed.

R&W Builders owner and President Jill Rutter said she cannot comment on the investigation or the settlement, but she told the Belleville News-Democrat, 'œJust don't believe everything you read.'ť

In 2014, after R&W was no longer eligible to participate in a Small Business Administration program intended to aid small businesses owned by socially and economically disadvantaged individuals, the company entered into a joint venture with St. Louis-based Global Environmental, Inc.

That joint venture, called Patriot Commercial Construction, LLC, successfully secured more than 30 task orders with a combined value of about $8 million from the Air Force through a contract at Scott Air Force Base, according to the U.S. Attorney's office.

The government claims R&W misrepresented itself to obtain the SBA's approval on the joint-venture agreement and, as result, received numerous government contracts that would have otherwise been limited for bid to participants in the SBA's program for disadvantaged small businesses.