The bulk of a settlement the United States Attorney’s Office for the District of Massachusetts reached with Aggregate Industries Northeast Region will be held in an account dedicated to long-term maintenance of Boston’s Central Artery/Tunnel, or Big Dig
Sources: U.S. Department of Justice; CP staff
The bulk of a settlement the United States Attorney’s Office for the District of Massachusetts reached with Aggregate Industries Northeast Region will be held in an account dedicated to long-term maintenance of Boston’s Central Artery/Tunnel, or Big Dig, including structures bearing allegedly nonspecification concrete the ready mixed supplier delivered from 1996 to 2005. A July 26 plea agreement between Aggregate Industries, the United States and Commonwealth of Massachusetts calls for the company to pay $50 million in cash and indemnify through 2037 the Big Dig for an additional $75 million in the event structural maintenance costs attributable to the nonspecification concrete exceed the upfront payment.
The agreement resolves criminal and civil liabilities in a case charging Aggregate Industries Northeast with conspiracy to defraud the United States through the submission of false claims for payment. The U.S. Attorney charged that the company delivered to Big Dig and other Boston sites approximately 5,700 loads of ready mixed concrete that did not meet project specifications. Federal officials contend that those loads had exceeded a 90-minute limit for mix pouring or placement, or had been “adulterated” with post-batch water or other ingredients not permitted under project specifications. The cash payment covers $42.72 million to seed the future CA/T maintenance account and settle federal and state false claims charges, and a $7.28 million fine for federal criminal charges. The latter was derived from a convoluted formula factoring about $5.2 million collected for approximately 64,000 yd. of nonspecification concrete.
Aggregate Industries must also a) pay $500,000 for testing of concrete specimens taken from Big Dig structures; and, b) retain an independent monitor who for five years will report to the U.S. Attorney’s Office and Federal Highway Administration on the company’s compliance with federal and state laws and regulations. Through the plea agreement and fulfillment of the monitoring terms, the company is avoiding debarment by the FHWA. Separately, the U.S. Attorney is pursuing a case against six Aggregate Industries Northeast employees charged with participation in the nonspecification mix deliveries.