A prominent Springdale construction contractor pleaded guilty today to mail fraud and filing false tax returns in connection with a scheme that deprived a shopping mall company and the IRS of a total of more than $1 million.
Robert E. Crawford, 54, ran R.E. Crawford Construction Inc. In 2007, Simon Properties Group hired Mr. Crawford's firm to build malls in Seattle and in Laguna Hills, Calif., for a total of around $15 million.
Mr. Crawford's firm got the job, according to Assistant U.S. Attorney Shaun Sweeney, through a former Simon senior vice president, referred to in the federal case only as M.P., because he has not been charged to date. A civil lawsuit has identified him as Mark Palombaro, of the Indianapolis area.
Mr. Crawford then paid the vice president kickbacks totaling around $766,000, through a front company, according to Mr. Sweeney. Because Mr. Crawford told his accountant that the kickbacks were actually consulting payments, and thus deducted them from his earnings on tax returns, he owes the IRS $275,730, the prosecutor said.
Mr. Crawford covered the kickbacks by inflating his bills to Simon by around $1 million, and when the mall company became suspicious, he created fake subcontractor bills, according to Mr. Sweeney.
Simon sued Mr. Crawford and others, and he agreed to a $3.3 million settlement, including the amount lost by the company, interest and other charges, Mr. Sweeney said.
Mr. Crawford faces sentencing Dec. 13 before U.S. District Judge David S. Cercone. He is free on $10,000 unsecured bond.
Neither Mr. Crawford nor his attorney had any comment.
Rich Lord: firstname.lastname@example.org, 412-263-1542 or Twitter @richelord. First Published June 5, 2013 12:45 AM