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News » US » Construction company boss jailed for fraud » published 9 Jul 2018

Construction company boss jailed for fraud

The boss of a Texas construction company has been sentenced to 18 months in prison for defrauding the US State Department out of US$1.37m.

Gary A Duff, 53, of Kansas City, Kansas, is the owner, chief executive officer and former president of  HERC Solutions. He was sentenced last week after pleading guilty in February to a one-count criminal information charging him with conspiracy to defraud the United States and commit wire fraud.

According to admissions made in connection with Duff’s plea, HERC specialized in international construction projects for the State Department and other agencies in military zones and developing countries. 

Duff’s co-conspirator, Steven J Graves, 66, of Woodbridge, Virginia, was a contract specialist and senior contracts administrator for the State Department’s Office of Acquisitions Management from November 2011 to February 2013.  In this capacity, Graves often served as a point of contact for contracts awarded to HERC and other companies seeking to perform construction work or provide supplies and materials to US embassies and consular buildings.

Duff and Graves used Graves’ official positions to steer contracts to HERC during a period when Graves was an actual or de facto partner in HERC.  Graves served as the assigned point of contact for State Department contracts awarded to HERC while attempting to generate business and raise capital for HERC. Simultaneously, he was concealing his conflict of interest from others, was participating in HERC’s internal business operations, and was disclosing confidential procurement information to HERC and its business partners, according to the Justice Department. Upon his departure from government service, Graves immediately became HERC’s majority owner and a company executive.

On 20 September 2017, Graves pleaded guilty to a two-count criminal information charging him with conspiracy to defraud the United States and commit wire fraud and a willful violation of the conflict of interest statute.  Graves was sentenced to serve 15 months in prison on 19 January.


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This article was published on 9 Jul 2018 (last updated on 9 Jul 2018).

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