Dive Brief:
- Virginia architect Mark Farmer admitted to using inside information from William Montague, former head of Louis Stokes Cleveland Veterans Affairs Medical Center, to gain VA contracts, according to Cleveland.com. Farmer also confessed that he knew about $3.9 million in illegal deals resulting from access to that information.
- Farmer, a former employee of Cannon Design, made the admission as part of a post-conviction plea deal under which he will serve 21 months to six years in prison. The deal also requires Farmer to forfeit $70,801 in proceeds resulting from the illegal dealings and pay possible fines between $10,000 and $250,000.
- Farmer was convicted of conspiracy, racketeering, embezzlement, bribery, theft of public money, mail fraud and wire fraud in August.
Dive Insight:
Although Farmer admitted he knew about $3.9 million gained from the inside information, Cleveland.com reported that, according to now-sealed documents, others at Cannon Design say the information from Montague resulted in up to $20 million in projects.
"High-ranking officials at Cannon Design knew about and approved of the payments to Montague and received confidential documents and information that Montague provided from the VA," the plea agreement said, however, no one else from Cannon has been charged yet, Cleveland.com reported.
This case is another one of the problems surrounding the VA construction system. Its Aurora, CO, hospital, which broke ground in 2010, is behind schedule, $1 billion over budget and now expected to cost $1.67 billion.
In November, the U.S. Army Corps of Engineers awarded contractor Kiewit-Turner an additional $571 million to finish the hospital, allowing the joint venture to complete its work on the project. A September Army Corps of Engineers study found that the VA management structure was inefficient, with the delays and overruns caused by design changes, poor control of budgets and mismanaged contracts.
