Newspaper article The Florida Times Union

More Charges Filed in Building Fraud Cases; Three Subcontractors in Jacksonville Accused of Failing to File Tax Returns

Newspaper article The Florida Times Union

More Charges Filed in Building Fraud Cases; Three Subcontractors in Jacksonville Accused of Failing to File Tax Returns

Article excerpt

Byline: PAUL PINKHAM

Three Jacksonville building subcontractors who cooperated with an ongoing grand jury investigation into millions of dollars worth of fraud and money laundering in the construction industry have been charged with failing to file income tax returns.

The misdemeanor charges appear to be a precursor to more substantial criminal indictments against building contractors prosecutors say used sham companies and undocumented workers to avoid paying workers compensation insurance or taxes, according to attorneys involved in the case.

Subcontractors Johnny J. Beavers, Wendell B. DeWinter and Buddy Frank Martin all became informants for the government during the six-year investigation. They and a fourth man, Craig Harms, weren't indicted but instead were charged Thursday in criminal informations by the U.S. Attorney's Office. They were given notices to appear before a federal magistrate later this month.

"They're probably cooperating," said attorney Thomas Fallis, who represents an unnamed subcontractor under investigation. "If they [federal prosecutors] filed informations and not indictments, that means they probably have agreements. That's been the practice."

Beavers already has signed a plea agreement that calls for his cooperation, said his attorney, Assistant Federal Defender James Burke. He has repaid the Internal Revenue Service, Burke said.

"He cooperated substantially quite a while ago," Burke said, including wearing a wire in 2000 and testifying before the grand jury.

Martin's attorney wouldn't comment on Thursday's charges. Lawyers for DeWinter and Harms couldn't be reached. Federal prosecutors didn't return phone calls.

The sprawling grand jury investigation began when agents noticed DeWinter had $10 million worth of currency transactions in his name at the U.S. Treasury Department, according to court testimony by Internal Revenue Service Special Agent Frank Odom.

Agents determined that DeWinter, Beavers and others had set up shell construction companies that would obtain workers compensation insurance, then cash payroll checks for uninsured subcontractors, keeping a percentage for themselves, said First Assistant U. …

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