Frank Loconte, Mail Fraud and Tax Evasion, Massachusetts 2022

Beverly man pleads guilty to mail fraud and tax evasion, defrauding over $4 million from union workers and the IRS.

A Beverly Farms man has pleaded guilty to a multi-million dollar payroll scheme involving underreporting of overtime hours for union employees and failing to collect and pay payroll taxes. Frank Loconte, 62, pleaded guilty to one count of mail fraud and one count of failing to pay taxes.

According to authorities, from 2009 to 2022, Loconte was the president of NER Construction Management Corporation, a Wilmington-based construction company that employed union workers. He was also the president of the company's employment management company, NER Management LLC.

Loconte was responsible for collective bargaining with multiple unions, including the Bricklayers and Allied Craftsmen Local Union No. 3 and various local unions affiliated with the Massachusetts and Northern New England Laborers' District Council of the Laborers International Union of North America.

Between January 2014 and May 2022, Loconte engaged in a scheme to defraud the union benefit funds and the IRS by paying certain union workers for overtime hours worked without reporting these hours to the union benefit funds and without making the required payroll tax withholdings and payments.

Loconte used NER business accounts to pay for personal expenses, including vehicles, personal property taxes, household improvements, and golf memberships, and failed to report these benefits to the IRS. As a result, Loconte defrauded union workers of more than $1 million dollars for overtime work covered by the collective bargaining agreements and defrauded the IRS of more than $3 million by not making the required payroll tax and union dues withholdings and payments.

Loconte is scheduled to be sentenced on November 29, 2023, and faces up to 20 years in prison, three years of supervised release, and a fine of up to $250,000 for mail fraud. He also faces up to five years in prison, two years of supervised release, and a fine of up to $250,000 for willful failure to collect and pay over taxes.

Source: https://www.justice.gov/usao-ma/pr/beverly-farms-man-pleads-guilty-multi-million-dollar-payroll-scheme