BOSTON — A New Hampshire-based asbestos abatement company has admitted to running a rigged two-tier payroll system designed to cheat union workers out of hard-earned benefits. AQE, Inc. of Windham, NH pleaded guilty today to 18 counts of mail fraud, one count of benefit fund embezzlement, and 18 counts of filing false documents with an ERISA fund—all tied to a deliberate scheme to skirt union obligations and rob the Massachusetts Laborers Benefit Fund (MLBF) of hundreds of thousands in dues and contributions.
The scam, known in the trade as a ‘double-breasted shop,’ allowed AQE, Inc. to exploit union labor while paying non-union wages. The company, a signatory to union contracts, used its payroll to pay union members when jobs required union participation. But when the job didn’t mandate union status, those same workers were shifted to the books of Air Quality Experts, Inc.—a shell entity operating as part of the same business—where they were paid below union scale and stripped of benefits. No contributions were made to the MLBF, which supports 8,000 laborers and their families with medical and pension coverage.
Over months of contracts across Massachusetts, AQE, Inc. systematically underreported union members’ hours by submitting falsified ‘remittance reports’ to the MLBF. Thousands of hours went unrecorded. Hundreds of thousands of dollars in required benefit payments vanished. The fraud wasn’t accidental—it was baked into the company’s operations, a cold calculation to boost profits on the backs of working men and women.
As part of the plea, AQE, Inc. has agreed to pay $500,000 in restitution to the MLBF. The company was indicted in January 2016 and now faces sentencing before U.S. District Court Judge Patti B. Saris on May 4, 2017. Each charge carries a potential sentence of one to five years of probation, a fine of $500,000 or double the financial gain, and mandatory restitution—though actual penalties are typically lower under federal guidelines.
The case was brought by Acting United States Attorney William D. Weinreb, with support from Cheryl Garcia, Special Agent in Charge of the Department of Labor’s Office of Inspector General, and Susan Hensley, Regional Director of the Department of Labor’s Employee Benefits Security Administration. Prosecution was led by Assistant U.S. Attorneys Fred M. Wyshak, Jr. and Ryan M. DiSantis from Weinreb’s Public Corruption Unit—no strangers to cracking down on labor racketeering and financial abuse.
This conviction sends a message: exploiting union contracts and starving benefit funds won’t be tolerated. The MLBF isn’t a suggestion box—it’s a lifeline. And when companies like AQE, Inc. rip that away, federal prosecutors will come hard, with mail fraud statutes, ERISA violations, and the full weight of the DOJ behind them.
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Key Facts
- State: Massachusetts
- Agency: DOJ USAO
- Category: Fraud & Financial Crimes
- Source: Official Source ↗
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