Sunday, August 12, 2012

Target Stores Files RICO Lawsuit Claiming Paving Fraud By Chicago Area Contractor

Target Stores has filed a civil lawsuit in federal court in Minneapolis under the Racketeering Influenced and Corrupt Organizations Act against Bridgeview based Rose Paving Company, LCH Pavement Consultants, United Paving Company, American Pavement Solutions, Asphalt Maintenance, Inc., and officers of several of the named companies, claiming that the defendants conspired to defraud Target of millions in a bid rigging and kickback scheme involving maintenance of parking lots at 1,700 Target stores across the country. Target alleges that LCH organized the participating paving contractors to divide up the $100 million worth of parking lot repair work by fraudulently inflating bids, agreeing to submit non-competitive prices on bids outside their corruptly designated territories, and requesting bids only from contractors in on the scheme.

Target also contends that participating paving contractors overbilled for work never actually performed, and charged for removal and replacement of asphalt all the way down to the substrate when the work done was only a surface overlay. The suit says Target was billed for and paid LCH for hundreds of thousands of dollars in work that was never done, and that LCH paid the contractors submitting false billings and then demanded kickbacks from them.

Store locations named in the complaint as being involved in the fraudulent billings include Target parking lots in Cicero and Lake Zurich. Other locations identified in the lawsuit include stores in California, Arizona, Montana, Virginia, Pennsylvania, Texas, Georgia and New York. Target claims the conspiracy began in 2009 and continued through 2012.

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