Suffolk Man, CEO, Paid Bribes For Contract From Fortune 500 Company: Feds

NEW YORK — Two men are facing charges for participating in a scheme to bribe a senior project manager at a Fortune 500 real estate services firm to obtain contracting work, the United States Attorney for the Southern District of New York announced Thursday.

Troy Caruso, 56, of Smithtown, and Ludlow, Vermont; and John Nolan, 42, of Brooklyn, were arrested Thursday. Both men are scheduled to appear in federal court in Manhattan later Thursday.

Caruso is the owner and CEO of a commercial construction and contracting company in New York City, while Nolan is a senior executive at the contracting company, officials said.

"As alleged, Troy Caruso and John Nolan bribed a senior-level individual at a Fortune 500 company to award their company favorable contracts, resulting in the parties involved fraudulently obtaining millions," U.S. Attorney Damian Williams said in a news release. "In the construction world, fair bidding is crucial to the success or downfall of a business, and kickback schemes like the one we allege in this case can undermine that process. Those attempting to corrupt the bidding process by gaining an unfair advantage over their law-abiding counterparts will face criminal prosecution."

From February 2021 to September 2023, Caruso and Nolan paid kickbacks to an employee of a global and publicly-traded commercial real estate services company in exchange for help and preferential treatment so that the contracting company would be awarded projects managed by the real estate firm, prosecutors said.

In March 2021, Caruso and Nolan were introduced by someone to a senior project manager at the firm, officials said. The project manager managed the contract bidding process and were awarded contracts to work on construction projects for the firm's clients, authorities said.

Beginning in or about March 2021, because of the kickback scheme, investigators said, the project manager took actions they otherwise would not have taken to ensure that the contracting company was awarded a pre-construction contract and a construction contract relating to a certain project, which was managed by the real estate firm on behalf of its client, a health services business that provides hospital, medical, and other health services to patients.

The senior project manager ensured that the contracting company was on the real estate firm’s "bid list" so that it could submit bids relating to the project that it otherwise could not have submitted, officials said. The manager also provided non-public information to Caruso and Nolan about the bidding process and recommended the contracting company for both the pre-construction contract and the construction contract relating to the project, prosecutors said.

Investigators said as a result of the kickback scheme and the project manager's actions, the contracting company was awarded the pre-construction and construction contracts for the project, the latter of which was worth roughly $3.55 million.

In exchange for the project manager's "assistance and preferential treatment," Caruso and Nolan agreed to pay kickbacks to the manager at 1 percent of the construction value of any project managed by the real estate firm that resulted in a contract award to the contracting company, authorities said.

Caruso and Nolan agreed to pay the project manager approximately $35,500 for the project and ultimately paid the manager around $33K in kickbacks for their assistance, officials said. Most of these payments were made in cash around New York City, investigators said.

Caruso and Nolan also paid the person who connected them to the project manger roughly $15K for their help in the kickback scheme, prosecutors said.

Caruso and Nolan tried to get additional contracts from the real estate firm with the project manager's aid as part of the kickback scheme, officials said. Between 2022 and 2023, in exchange for Caruso and Nolan's promise of payment for any contract awarded to the contracting company, the project manager provided the duo with help relating to two more construction projects managed by the real estate firm that did not result in contract awards to the contracting company, authorities said.

Caruso and Nolan were each charged with one count of conspiracy to commit honest services wire fraud and one count of honest services wire fraud, which each carry a maximum sentence of 20 years in prison.