The Kerryman (South Kerry Edition)
South Kerry-linked Navillus bosses facing fraud charges in New York
THREE senior executives of major New York building firm Navillus, which is owned by a Ballinskelligs family, have been charged with fraud and conspiracy offences by US authorities.
Last Thursday Navillus CEO Donal O’Sullivan (59); his sister Helen O’Sullivan (60), the company’s treasurer, and Navillus’ Comptroller Padraig Naughton (48) were arrested on Federal wire fraud, conspiracy and embezzlement charges.
According to the Eastern District of New York US Attorney’s Office the 11 counts facing the O’Sullivans and Mr Naughton relate to an alleged scheme, operated between 2011 and 2017, to ‘cheat’ several Union Benefit Funds out of over $1 million in required contributions.
Founded by Donal O’Sullivan and his brothers Leonard and Kevin in 1987, Navillus is one of the largest construction companies in New York and has been involved in major projects including construction of the new One World Trade Centre tower on the site of the 9/11 terror attacks.
Donal O’Sullivan – who retains close links with Kerry and Ballinskelligs – is now the sole shareholder in the company which employs around 1,600 people.
The current charges are linked to a 2017 civil action that saw Navillus fined $76 million for using a separate ‘companion’ company to illegally avoid paying union wages and benefit payments. The fine was one of the biggest ever handed down in the US in a case of its kind. Navillus subsequently filed for bankruptcy. Following a settlement – agreed to keep the company in business – Navillus ultimately had to pay €25.7 million.
Detailing the indictments Attorney for the Eastern District of New York Seth Du Charme said the defendants “were the architects of a payroll scheme designed to evade obligatory contributions to union benefits funds that their workers depend upon.”
Under collective bargaining agreements Navillus is obliged to make contributions to union benefit funds if it uses non union workers. The charges allege that Navillus used a construction consultancy firm – which would submit fake invoices for surveys and project estimates – to pay around $7.2 million in wages to non-union workers without paying the required union benefits.
In a statement to the media Donal O’Sullivan’s attorney Sean O’Shea said the Federal claims were “flatly false”.
Mr O’Shea noted that in the period Navillus is alleged to have dodged $1 million in payments it had paid out over $200 million to the same benefit funds.
Mr O’Shea said the Federal proceedings were “a civil case dressed up in other garb” adding that the allegations are false, and that he expects “full vindication at a jury trial.”
“It’s pretty sad when the government decides to act as a collection agency for these unscrupulous unions,” said Mr O’Shea.
At Thursday’s arraignment hearing in New York Donal O’Sullivan was released on a $500,000 bail bond; Helen O’Sullivan and Padraig Naughton were each released on their own $250,000 bonds.