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SF Official Indicted for Fraud

April 28, 2000

SAN FRANCISCO (AP) _ A city official who approved minority contracts was indicted for fraud Thursday along with two companies and four executives who allegedly used a minority contractor as a front for a white-owned company.

Scott-Norman Mechanical Inc. was fraudulently awarded $55 million in city airport contracts while it was controlled by white-owned Scott Co. of California, allege indictments returned by a federal grand jury.

Zula Jones, the second-highest official in the city’s Human Rights Commission, approved Scott-Norman as a minority-owned company eligible for bid preferences under the city’s minority contracting program, even though she knew it was ineligible, the indictment said. She faces 16 counts of fraud and making false statements.

``The purpose of minority contracting programs is to ensure that individuals and businesses who have been denied equal access to public contracts are guaranteed a full and fair opportunity to do public work,″ U.S. Attorney Robert Mueller said in a statement. ``Those who attempt to obtain fraudulent contracts under this program deserve to be prosecuted.″

The FBI has been investigating city contracting programs for more than a year. Federal agents sealed the offices of the Human Rights Commission one weekend last July to look for records. In January, the agency subpoenaed Mayor Willie Brown’s office for records of his meetings with 16 companies and 23 business executives and staffers connected with the contracting program, dating to 1995.

``We need to let the legal process take its appropriate course of action,″ Brown spokeswoman Kandace Bender said Thursday.

Jones’ lawyer, Carleton Briggs, declined comment. Jerrold Ladar, lawyer for Joseph Guglielmo, the president and CEO of Scott Co., said Guglielmo had committed no fraud and would be exonerated. Guglielmo faces 21 counts of fraud and making false statements.

Robert Carey, lawyer for Alvin P. Norman Jr., president of Scott-Norman Mechanical, did not immediately return a telephone call to his office. Norman faces 20 counts.

The others indicted are Robert T. Nurisso, Scott Co.’s executive vice president, and Richard Davis, Scott’s vice president and chief financial officer. They face 20 counts each.

The defendants are due in court May 18. Each charge is punishable by up to five years in prison.

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