Con­trac­tor gets prison for $800,000 scam

Latham man ex­ploited mi­nor­ity-owned firms, pen­sion fund ben­e­fits

Albany Times Union - - FRONT PAGE - By Robert Gavin

A Latham con­trac­tor ex­ploited mi­nor­ity-owned firms and a pen­sion fund, then bought an RV, snow­mo­biles.

A for­mer Al­bany con­trac­tor who ex­ploited mi­nor­ity-owned busi­nesses in an $800,000 scam was sen­tenced to 3 1/2 to 12 years in prison Fri­day — and re­ceived a tongue-lash­ing from the judge for min­i­miz­ing his crim­i­nal be­hav­ior.

Michael Mar­tin, 47, of Latham, the for­mer owner of now-de­funct Eastern Build­ing & Restora­tion, lis­tened as one of his vic­tims, 66-year-old Mo­lain Gil­more of Sch­enec­tady, de­scribed how his crime dev­as­tated her fi­nan­cially. She said she can no longer af­ford a car and is liv­ing off So­cial Se­cu­rity.

“This is hor­ri­ble fi­nan­cially for me,” Gil­more, the for­mer owner of Pre­ci­sion En­vi­ron­men­tal So­lu­tions, an as­bestos re­moval busi­ness, said out­side court af­ter the sen­tenc­ing. “This has up­ended my whole life. For 47 years, I drove. I can’t. “

Mar­tin apol­o­gized to the vic­tims, as well as the court and his fam­ily, but did not stop there.

“It was never my in­tent to take ad­van­tage of any­one,” Mar­tin told Sch­enec­tady County Judge Matthew Syp­niewski. “The per­son you see here to­day, your honor, does not rep­re­sent the per­son who I am. Lastly, I’d be truly grate­ful if you could rec­om­mend a shock in­car­cer­a­tion pro­gram.”

Shock in­car­cer­a­tion al­lows in­mates to serve six months in a mil­i­tary boot camp-style pro­gram in­stead of prison.

“You should have stopped at ‘I’d like to apol­o­gize,’” the dis­gusted judge told Mar­tin, “be­cause ev­ery­thing af­ter that was ei­ther disin­gen­u­ous or mis­di­rected. You tell me that you didn’t have in­tent to take ad­van­tage of any­one? That’s ex­actly what you pleaded guilty to do­ing. So for me to have to re­mind you of that just rep­re­sents to me that

you re­ally have no in­sight and ac­count­abil­ity for your ac­tions. You de­serve each and ev­ery day that you’re in­car­cer­ated.

“And no, I’m not rec­om­mend­ing Shock,” the judge added.

The pro­gram is typ­i­cally re­served for young adults who com­mit lesser crimes.

Mar­tin and Eastern’s comptroller, D. Scott Hen­zel, vic­tim­ized Pre­ci­sion and an­other mi­nor­i­ty­owned busi­ness, Lorice En­ter­prises, as well as the theft of pen­sion fund ben­e­fits from more than 50 Eastern employees, ac­cord­ing to state In­spec­tor Gen­eral Cather­ine Leahy Scott, whose of­fice brought the case.

“This for­mer cor­po­rate ex­ec­u­tive ex­ploited smaller strug­gling busi­nesses and his own employees with self-in­dul­gent crim­i­nal schemes that shame­lessly shat­tered the liveli­hoods of his many vic­tims. He cor­rupted a laud­able pro­gram meant to bol­ster mi­nor­ity-owned busi­nesses and in­stead ru­ined them fi­nan­cially while en­rich­ing him­self,” the in­spec­tor gen­eral said.

Mar­tin spent the pro­ceeds of his crimes on Har­ley-david­son mo­tor­cy­cles, snow­mo­biles, per­sonal wa­ter­craft, a $170,000 RV, pur­chases for his girl­friend and trips to the Do­mini­can Repub­lic and the Ba­hamas.

The state sets aside a per­cent­age of pub­lic con­tracts for bids by women and mi­nor­ity-owned busi­nesses. In 2014, Gov. An­drew Cuomo in­creased the goal for the per­cent­age of state con­tracts for those busi­nesses to in­crease from 20 per­cent to 30 per­cent by 2019.

Mar­tin and Hen­zel ap­proached two com­pa­nies, Lorice En­ter­prises and Pre­ci­sion En­vi­ron­men­tal So­lu­tions, claim­ing to of­fer them an op­por­tu­nity to part­ner with Eastern. It was sup­posed to help the com­pa­nies suc­cess­fully op­er­ate and bid con­struc­tion projects. In­stead, Mar­tin and Hen­zel took over the day-to-day op­er­a­tions of the busi­nesses, in­clud­ing de­ci­sions on staff, bids, bank­ing and other fi­nan­cial mat­ters. The com­pa­nies were mi­nor­ity-owned on pa­per only, of­fi­cials said.

“I’m $300,000 in debt with taxes alone,” said Gil­more, “It’s un­for­tu­nate that it’s come to this . ... I don’t hold any an­i­mos­ity. I just want my money.”

To cover up their crimes, Mar­tin and Hen­zel falsely cer­ti­fied on pub­lic works projects that they had paid pen­sion pay­ments to ev­ery em­ployee.

In 2014, Eastern went out of busi­ness, declar­ing it­self fi­nan­cially un­able to per­form nu­mer­ous con­tracts. Mar­tin then moved Pre­ci­sion from Al­bany to Sco­tia, where Pre­ci­sion paid the land­lord $1,800 a month in rent. Mar­tin made a fake rental agree­ment be­tween Pre­ci­sion and a fic­ti­tious com­pany — Delta Land Hold­ings — in which Pre­ci­sion paid Delta more than $9,000 a month in “rent,” which Mar­tin stole, of­fi­cials said.

Mar­tin ripped off $154,547 from Pre­ci­sion through the rent scam. He stole an­other $204,995 from Al­legheny Ca­su­alty with bo­gus claims that Pre­ci­sion was a sub­con­trac­tor of Eastern that was never paid for work. In re­al­ity, Pre­ci­sion had not been sub­con­trac­tor on the project.

Ear­lier this year, Mar­tin and D. Scott Hen­zel, 52, of Al­bany were ar­rested on charges in­clud­ing iden­tity theft, false fil­ing, fail­ing to pay pre­vail­ing wage and schem­ing to de­fraud.

Hen­zel pleaded guilty last month to a fail­ure to pay pre­vail­ing wages, a felony. He will be sen­tenced Jan. 8.

Mar­tin was sep­a­rately charged in an­other in­dict­ment with grand lar­ceny and in­sur­ance fraud.

Skip Dick­stein / Times Union

Michael Mar­tin, cen­ter, with his at­tor­ney Sam Bres­lin, at his sen­tenc­ing. Mar­tin spent crime pro­ceeds on mo­tor­cy­cles, snow­mo­biles and an RV.

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