Jennifer Copeland, operating manager for Steve Rauch Inc., and Lawrence Greger, attorney for Sutton Cameron, entered the guilty pleas during remote hearings. Rose found both companies guilty and set sentencing for March 12.
The companies face a maximum penalty of one to five years of probation, a fine of not more than $500,000, and a $400 special assessment.
Rauch, Sutton Cameron and James Cameron, a Green Star employee, all faced prison sentences if they had been convicted of the original charges of one of count of conspiracy to commit mail fraud and six counts of mail fraud filed by the federal government last year. Each charge carried a possible prison sentence of up to 20 years.
Rauch and Sutton Cameron had pleaded not guilty to those charges but James Cameron never entered a plea.
The conspiracy charge the two companies pleaded guilty to on Friday involves a demolition contract Steve Rauch Inc. completed for the city of Dayton in 2014, according to the bill of information containing the charge. Copeland and Greger said the facts outlined in the bill of information were true.
Green Star Trucking worked on that project but Rauch and Cameron’s companies defrauded the city of Dayton by falsely claiming that Green Star had done additional work. This allowed Rauch to fulfill the city’s requirement that disadvantaged small or women-owned businesses participate in city demolition contracts.
Steve Rauch Inc. had not met the required disadvantaged business participation goal and asked Green Star Trucking to “falsely certify that it had completed and been paid for several thousand dollars' worth of additional work on the project," according to the bill of information.
“Green Star agreed and signed the false paperwork. Steve Rauch Inc. then mailed this document to Dayton during June 2014, hoping that the city would release payments on the contract," according to the bill of information.
The court documents do not specify which project or how much money was involved.
The city of Dayton and Greger did not respond to a request for comment.
“Mr. Rauch is pleased that, as a result of today’s proceedings, all charges against him will be dismissed,” said Rauch’s attorney Chad Ziepfel. “As to Steve Rauch Inc., the company is satisfied to have resolution in this matter and looks forward to continuing to provide essential demolition and excavation services in the Dayton area, as it has done for more than 40 years.”
Ziepfel said if a corporation is placed on probation “a company representative will meet with the probation department as required. The specific conditions of probation are set by the probation department.”
Rauch, who also owns SRI and Rauch Trucking, and the Camerons were three of seven people the feds indicted last year as part of an investigation the FBI dubbed “Operation Demolished Integrity.”
That 2019 indictment alleged that Rauch subcontracted with Green Star to win government contracts that required disadvantaged business participation but that his company did the work. The Camerons were accused of signing paperwork to make it appear they were doing the work, for which Rauch paid them a few thousand dollars or forgave their debt to him, the indictment alleged.
A Dayton Daily News investigation published in December found that Rauch used Green Star to meet minority contracting goals for nearly $4.7 million in city of Dayton demolition contracts between 2008 and 2016. The investigation also found that that Green Star won work as a subcontractor on at least 34 public contracts since 2008.
Three other cases that were part of that federal investigation also related to city contracts, including ones that involved awarding a portion of the work to disadvantaged, minority and other small businesses.
Three of those indicted in that investigation were sentenced to prison after being found guilty. They are former Dayton City Commissioner Joey D. Williams, former state Rep. Clayton Luckie and former Dayton city employee RoShawn Winburn.
Dayton businessman Brian Higgins pleaded not guilty to three counts of mail fraud and one count of wire fraud. He is awaiting trial.