VAOIG Seal U.S. Department Of Veterans Affairs
Office of Inspector General
Columbia Resident Agency
P.O. Box 9232
Columbia, SC 29290
(727) 319-1215
Wednesday, November 06, 2002
NC Corporate President Sentenced for Fraud on VA Contracts
Kenneth R. Atkins, Special Agent in Charge, Southeast Field Office, Office of Inspector General, Department of Veterans Affairs, (VA) today announced that Applied Construction Technologies, Incorporated (ACT) President, DAVID A. CRIDER, was sentenced in Federal District Court, Raleigh, NC to 24 months incarceration, three years probation and restitution of $1.5 million.

Atkins explained that CRIDER had previously pleaded guilty to federal mail fraud charges presented by the Grand Jury. The criminal conduct began after CRIDER, as President of ACT, of Spring Lake, NC, received multiple VA construction contracts for renovation work at the VA Medical Center, Fayetteville, NC; Army contracts for work at Fort Bragg, NC; Navy contracts for Marine Corps Base Camp Lejeune, NC and Cherry Point Marine Corps Air Station and the U.S. Postal Service in Charlotte, NC. As the contracts progressed, CRIDER mailed false requests for payment to the government agencies and subsequently received government progress payments based on his certifications that his suppliers and subcontractors had been paid. CRIDER admitted that he knowingly failed to pay the suppliers and subcontractors as required. As a result, contracts were eventually defaulted and completion contractors had to be secured, resulting in additional delays in the opening of important VA medical and other facilities. The monetary loss on the ten contracts involved was $1.5 million. Additionally, CRIDER's criminal scheme contributed to the bankruptcy of a surety company that could not ultimately meet the bonding requirements on the contracts defaulted by ACT.

Atkins stated that the successful conclusion of this matter resulted from a four-year joint effort by his Columbia Resident Agency, the Army Criminal Investigations Division (CID) and the Naval Criminal Investigative Service (NCIS).

This case was prosecuted and coordinated by Assistant U. S. Attorney Peter Kellen of the Eastern District, Raleigh, NC.