Nagle, Fink Get Prison in $136M DBE Fraud Scheme

Joseph W. Nagle, 55, of Deerfield Beach, Florida, and Ernest G. Fink, Jr., 71, of Orwigsburg, Pennsylvania, are locked in for their roles in the largest Disadvantaged Business Enterprise (DBE) fraud ever recorded in the United States—$136 million in government contracts rigged over 15 years. The Third Circuit Court of Appeals slammed the door on their appeals November 30, 2016, upholding Nagle’s 84-month sentence and Fink’s 41-month term for systematically looting taxpayer-funded infrastructure projects across Pennsylvania.

The scheme, orchestrated through their company Schuylkill Products Inc. (SPI), relied on fraudulent certifications that minority-owned businesses were handling work and receiving profits—when in reality, Nagle and Fink ran the operation from the shadows. The U.S. Department of Transportation confirmed this fraud is the biggest of its kind in the nation’s history, undermining federal programs designed to level the playing field for disadvantaged entrepreneurs.

After a four-week trial in April 2012, Nagle was convicted on 26 counts, including conspiracy to defraud USDOT, mail fraud, wire fraud, and money laundering. Fink had already pleaded guilty in August 2010 to conspiracy to defraud the USDOT. Their initial sentences—84 months for Nagle, 51 for Fink—were tossed in September 2015 due to a miscalculation of losses under federal guidelines. But upon resentencing, Judge Sylvia H. Rambo recalculated the take: the actual profits diverted from legitimate DBE firms. She reimposed Nagle’s 84 months and reduced Fink’s to 41.

The Third Circuit’s ten-page ruling affirmed the recalculations, rejecting Fink’s claim that his age and non-violent offense warranted leniency. “A 41-month sentence for a 70-year-old first-time offender who, for at least fifteen years presided over the largest reported DBE fraud in the history of the U.S. Department of Transportation is not unreasonable,” the court wrote.

They weren’t alone. In 2014, three other SPI-linked executives were sent to prison: Romeo P. Cruz, 33 months; Timothy G. Hubler, 33 months; and Dennis F. Campbell, 24 months. Cruz’s Marikina Construction Corp. acted as a front for SPI, funneling contracts and cash while hiding the true ownership.

The FBI, U.S. Department of Transportation Inspector General’s Office, U.S. Department of Labor Inspector General’s Office, and IRS Criminal Investigation Division jointly cracked the case. Prosecution was led by U.S. Attorney Bruce D. Brandler and Assistant U.S. Attorney Kim Douglas Daniel. The message is clear: fraud against federal equity programs won’t be treated as white-collar window dressing—it’s theft on an epic scale, and the feds are coming for the ringleaders.