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OUTLINE OF GUILTY PLEAS; UNITED STATES v. SAUNDRA WEBB AND SANDAQ INC. ENGINEERING

 NEW YORK, Dec. 18 /PRNewswire/ -- Otto G. Obermaier, the United States Attorney for the Southern District of New York, and Thomas D. Thacher, II, Inspector General for the New York City School Construction Authority ("SCA"), announced the entry of guilty pleas today in what is believed to be the first racketeering conviction of an asbestos monitoring and removal company. Saundra Webb, the president of Sandaq, and Sandaq Inc. Engineering ("Sandaq"), by its Chief Executive Officer and Director Kenneth Charles, pleaded guilty today in Federal District Court in Manhattan to racketeering charges in the conduct of Sandaq's business, in violation of 18 U.S.C. 1962. The defendants admitted defrauding the New York SCA and the public through a variety of schemes, in obtaining and performing approximately $1 million worth of asbestos- testing and monitoring contracts, and the receipt of approximately $450,000 in payments related to the defendants' submissions of inflated and fictitious contractual claims.
 According to Mr. Obermaier, "In this case, the defendants cared more about their profit than they did about the safety of the students, teachers and staff in the New York City public schools, and their employees. The result in this case hopefully sends an important message of general deterrence that obtaining licenses and contracts by fraud will not be tolerated, particularly where a dangerous substance such as asbestos is involved."
 According to Sarah N. Chapman and Michael E. Horowitz the Assistant United States Attorneys in charge of the prosecution, the defendants admitted engaging in a pattern of racketeering activity through a variety of mail and wire frauds over the course of a two (2) year period. This racketeering activity included obtaining licenses for unqualified Sandaq employees by falsely representing in sworn filings with public agencies the qualifications of Sandaq's employees to perform asbestos sampling and analysis. The racketeering activity further included fraudulently obtaining certification for their laboratory by falsely representing to the New York State Department of Health the qualifications of Sandaq's laboratory personnel to analyze asbestos samples. Through these frauds the defendants induced the SCA to award Sandaq four (4) contracts and one (1) subcontract to perform asbestos monitoring and testing in the New York City public schools. Having obtained these five (5) contracts by fraud, the defendants continued their racketeering activity by submitting billings to the SCA that overcharged for the work performed and charged for work not performed.
 Mr. Horowitz further stated that as a result of her guilty plea, Webb is subject to 20 years imprisonment and a fine of up to the greatest of $250,000 or twice the gross gain or loss. As a result of the guilty plea entered by Kenneth Charles for Sandaq, the company is subject to a fine of up to the greatest of $500,000 or twice the gross gain or loss. Ms. Chapman added that the defendants have agreed to make to restitution to SCA and to the following forfeitures: (1) approximately $450,000, which represents the amount of money paid by the SCA to Sandaq pursuant to the five contracts, (2) all of Sandaq's corporate assets, including both real and personal property, (3) the corporations' accounts receivable related to asbestos monitoring and removal work and (4) certain additional real and personal property of Charles and Webb.
 Thomas D. Thacher II, the SCA's vice president and Inspector General, also said "The significance of these convictions is not just that these two defendants will be held accountable for their crimes, but that a company like this has been put out of business and will no longer be in a position to place its employees and our school children at risk."
 Today's guilty pleas were the result of an eighteen month joint investigation conducted by the SCA office of Inspector General, the Federal Bureau of Investigation, and the United States Attorney's Office.
 Mr. Obermaier praised the efforts of the SCA Office of Inspector General, particularly First Assistant Inspector General Kevin J. Ford and Investigative Attorney Terrence McDonald (both of whom were cross- designated a Special Assistant United States Attorney for this case) and Investigator Leroy Callier, and the Federal Bureau of Investigation, particularly Special Agent Suzanne Kennedy.
 The sentencing of the defendants is currently scheduled for Feb. 3, 1993, before the Honorable Robert L. Carter, United States District Judge, Southern District of New York.
 -0- 12/18/92
 /CONTACT: Kate Cosenza, public information officer, 212-791-1937, or Michael E. Horowitz, 212-791-0036, or Sarah N. Chapman, 212-791-0039, all of United States Attorney Southern District of New York; or Thomas D. Thacher II, vice president and Inspector General of New York City School Construction Authority, 212-901-6680/


CO: New York City School Construction Authority; Sandaq Inc. ST: New York IN: CST SU:

WB-OS -- NY067 -- 8344 12/18/92 15:34 EST
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Date:Dec 18, 1992
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