UPDATE: Rockland Bus Company Owner Indicted in BOCES Fraud Scheme

NEW CITY, NY — The US Attorney has indicted Rockland bus company owner Richard Brega in a scheme to defraud the Rockland Board of Cooperative Educational Services — at the same time that he announced a guilty plea from a BOCES official, William Popkave.

The charges against both: conspiracy, fraud, theft, bribery, and obstruction of justice.

"With the help of Popkave, one of their own officials, Rockland BOCES was taken for a ride—even if their buses were not," said William F. Sweeney Jr., the Assistant Director-in-Charge of the New York Field Office of the Federal Bureau of Investigation, in Thursday's announcement.

After the news broke Thursday afternoon, BOCES officials expressed deep disappointment. Chief Operating Officer Dr. Mary Jean Marsico and District Superintendent Dr. Charlene Jordan issued this statement:

"The admission of guilt by Mr. Popkave is disheartening and concerning, as he seriously breached the trust placed in him by the Rockland BOCES Board and administration.

As the individual formerly responsible for managing all BOCES transportation services, Mr. Popkave was entrusted with supervising the transportation of students with complex disabilities, Career and Technical Education students and district-based learners, in addition to overseeing fleet maintenance and bus driver testing and training programs. He officially retired in June 2016.

Rockland BOCES has cooperated fully with the investigation and will continue to do so.

We’re obviously dismayed and saddened by these circumstances, but cannot comment further on any matters which are part of the ongoing probe. We hold ourselves, and all of our employees, to the highest standards for professional public administrators.

As we have always done, BOCES will continue to provide students, families and educators the highest level of academic and support services in collaboration with our eight local school districts and community partners."

Brega owns several transportation companies and also operates the county’s bus system.

BOCES offers a variety of programs for the school districts in Rockland, including services for students with physical and mental disabilities.

This particular scheme, officials allege, involved Brega D.O.T. Maintenance Corp. They say Brega submitted phony invoices for maintaining and repairing BOCES buses — work his company didn't perform — and Popkave approved them. In return, they allege, Brega's company did car repairs for free for Popkave and his friends and family.

It wasn't apparently a very lucrative scheme. Officials allege Brega wrote phony invoices for more than $86,000 and they're saying the value of the free vehicle services that Brega DOT provided to Popkave totaled about $47,000.

Brega's name came up in 2015 connected with federal investigation into corruption in Rockland. Former Clarkstown Town Supervisor Alex Gromack Gromack took $10,000 from Brega for referring people to his transportation business. He didn't file a form with the town ethics board, and said later that he was told there wasn't a conflict of interest.

MORE READING:

• Legislators Award Bus Contract To Brega
• Legislators Criticize County Exec Over Bus Contracts
• Gromack Part of Federal Ethics Investigation

The full announcement:

Preet Bharara, the United States Attorney for the Southern District of New York, and William F. Sweeney Jr., the Assistant Director-in-Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), and Thomas Zugibe, the Rockland County District Attorney, today announced the unsealing of an Indictment charging RICHARD BREGA with conspiracy, fraud, theft, bribery, and obstruction of justice.

The charges arise from an alleged scheme to defraud the Rockland Board of Cooperative Educational Services (“BOCES”) by billing it for bus maintenance that was not performed. Bharara also today announced the guilty plea of WILLIAM POPKAVE, a former official with Rockland BOCES, to conspiracy, fraud, theft, bribery, and obstruction of justice, charged in a five-count Information unsealed today.

Manhattan U.S. Attorney Preet Bharara stated: “Richard Brega and William Popkave allegedly engaged in a corrupt scheme to charge Rockland County school districts for school bus repairs and maintenance that were never actually performed, then tried to cover their tracks through fake invoices and deceptive money transactions. The defendants’ alleged fraud and corruption not only betrayed the public trust, but risked making school buses, including some used for disabled children, less safe. Thanks to the work of the FBI and the Rockland County District Attorney’s Office, this allegedly callous scheme has been exposed.”

FBI Assistant Director-in-Charge William F. Sweeney Jr. stated: “Brega’s company was responsible for servicing a fleet of Rockland BOCES buses, some of which were used for physically disabled students. Checks were supposed to include repairs, preventative maintenance, and inspection. As alleged, Brega billed for services that were never completed. In fact, many of the buses hadn’t even been brought to the repair shop where the work would have been performed. As charged, with the help of Popkave, one of their own officials, Rockland BOCES was taken for a ride—even if their buses were not.”

Rockland County District Attorney Thomas Zugibe stated: “As alleged in the federal Indictment, Richard Brega, Jr., the Rockland BOCES vendor, submitted false invoices for school bus maintenance that was never provided. William Popkave would knowingly approve these invoices for payment, notwithstanding the fact that these services were never provided. Rockland BOCES administrators were unaware of the wrongdoing of its former employee. The allegations in this case highlights the essence of greed and extremely poor judgment by a former employee and the operator of Rockland County's largest provider of public transportation. With these charges, the Joint Public Corruption Task Force continues its mission to root out fraud and abuse at all levels. We are proud to be a part of it.”

As alleged in the Indictment and Information unsealed today in White Plains federal court[1]:

BREGA owned and controlled vehicle repair and transportation companies in Rockland County. Brega D.O.T. Maintenance Corp. (“Brega DOT”) was a fleet maintenance repair shop owned and controlled by BREGA.

Rockland BOCES serves eight school districts in Rockland County. Among the services that Rockland BOCES offers to its students is transportation, for which it has a fleet of buses and other vehicles (hereinafter collectively referred to as “Rockland BOCES’ buses” and “bus fleet”), some of which are specially equipped for students with physical disabilities. Rockland BOCES receives federal funding each year, significantly in excess of $10,000, including more than $1 million some years.

From in or about 2008 or 2009, through in or about 2015, Brega DOT provided vehicle repair service and maintenance for Rockland BOCES’ bus fleet. The service of Rockland BOCES’ buses by Brega DOT included regular preventive maintenance (“Preventive Maintenance”). To perform Preventive Maintenance on a Rockland BOCES bus, Brega DOT was supposed to, among other things, receive the bus at Brega DOT’s facility, inspect the bus, and, ordinarily, drive the bus. To obtain payment for Preventive Maintenance, Brega DOT created invoices documenting the work done, provided the invoices to Rockland BOCES, and, once CC-1 approved the bill, received payment from Rockland BOCES.

From in or about 2012 through in or about 2014, BREGA conspired to and did steal money from Rockland BOCES by, among other things, billing Rockland BOCES for vehicle repair services that, as BREGA well knew, were never performed. To do so, BREGA had fraudulent invoices made, to give the false appearance that his company had performed regular Preventive Maintenance on certain buses, when in fact those buses were not even brought to Brega DOT.

To create the fraudulent invoices, and to obtain payment from Rockland BOCES for work that was never performed, BREGA bribed WILLIAM POPKAVE – the employee of Rockland BOCES at the time who oversaw upkeep and maintenance of its buses – with tens of thousands of dollars’ worth of free personal vehicle repairs. POPKAVE emailed BREGA lists of buses and their mileages for purposes of creating fraudulent invoices, and thereafter approved payment of the fraudulent invoices at Rockland BOCES.

In addition, during the investigation of the criminal conspiracy, BREGA obstructed justice by attempting to cover up his bribery of POPKAVE with a series of financial transactions designed to conceal BREGA’s provision of free personal vehicle services to POPKAVE.

The conspiracy was accomplished through, among other things, the following means and methods:

From in or about 2009 through in or about 2014, BREGA provided POPKAVE with free vehicle repairs for POPKAVE’s personal vehicles and those of his friends and family. At one point, the value of the free vehicle services that Brega DOT provided to POPKAVE totaled approximately $47,000.

From in or about 2012 through in or about 2014, BREGA caused Brega DOT to bill Rockland BOCES for Preventive Maintenance that, as BREGA well knew, Brega DOT never performed. Brega DOT, in fact, billed Rockland BOCES for more than $86,000 for claimed instances of Preventive Maintenance when, in those instances, the bus at issue was never even brought to Brega DOT.

In addition, BREGA caused Brega DOT to automatically and routinely overcharge Rockland BOCES for labor and parts.

To bill Rockland BOCES for work that was not done, on buses that were not brought to Brega DOT, BREGA, POPKAVE and another co-conspirator (“CC-2”), along with others acting on their behalf, created fraudulent invoices. POPKAVE emailed BREGA lists of buses and their respective mileages. BREGA then caused CC-2 and others to create invoices, listing the mileages provided by POPKAVE, falsely documenting that the bus had undergone Preventive Maintenance at Brega DOT, when in fact, as BREGA well knew, it had not.

Once the fraudulent bills were sent from Brega DOT to Rockland BOCES, POPKAVE authorized payment. Payments were mailed from Rockland BOCES. POPKAVE did so because, among other things, Brega DOT was servicing POPKAVE’s vehicles and those of his family and friends for free.

* * *

BREGA was arrested this morning and will be arraigned today on the charges in the Indictment before United States Magistrate Judge Judith C. McCarthy in the White Plains federal courthouse.

BREGA, 49, of Rockland County, is charged with five counts: (1) conspiracy to commit mail fraud; (2) mail fraud; (3) bribery concerning a program receiving federal funds; (4) theft concerning a program receiving Federal funds; and (5) obstruction of justice. The offenses carry a combined maximum penalty of eighty years in prison and a $250,000 fine.

POPKAVE, 61, of Rockland County, New York, pled guilty to five counts: (1) conspiracy to commit mail fraud; (2) mail fraud; (3) theft concerning a program receiving Federal funds; (4) bribery concerning a program receiving federal funds; and (5) obstruction of justice. The offenses carry a combined maximum penalty of eighty years in prison and a $250,000 fine.

The statutory maximum penalties are prescribed by Congress and are provided here for informational purposes only, as any sentencings of the defendants would be determined by the judge. POPKAVE will be sentenced at a future date. The case is assigned to U.S. District Judge Vincent Briccetti.

Mr. Bharara praised the outstanding investigative work of the FBI, the Rockland County District Attorney’s Office, and the United States Department of Transportation Office of Inspector General.

This case is being handled by the Office’s White Plains Division. Assistant United States Attorneys Michael Maimin and Benjamin Allee are in charge of the prosecution.

The charges contained in the Indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.

MAP: Brega Transportation Corp via google maps