Andrew Persaud, Warehouse Renovation Scam, Harrisburg PA, 2023

HARRISBURG, PA – Andrew Persaud, 44, of North Potomac, Maryland, is headed to federal prison after being sentenced to 21 months for defrauding the U.S. Navy. Persaud, the former President and Corporate Director of Persaud Companies, Inc., bilked the government out of over $1.2 million while renovating warehouses at the Naval Support Facility in Mechanicsburg, Pennsylvania.

The scheme unfolded after Persaud Companies secured a $4.4 million contract in 2011 to overhaul several warehouses at the Naval Support Activity (NSA) facility. Starting in May 2012, Persaud hired roughly 17 subcontractors to do the work. But instead of paying them, he submitted invoices to the Navy falsely certifying that all subcontractors had been paid in full. Between June and August of 2012, the Navy wired Persaud $1,206,470 based on these lies.

The house of cards quickly crumbled. By September 2012, most of the subcontractors had walked off the job, unpaid. The Navy terminated the contract after discovering Persaud’s certifications were complete fabrications. While Persaud had paid a $53,539 premium for a materials/labor bond – a requirement for the initial contract payment – that bond ultimately covered $1,281,753 in unpaid subcontractor claims, but did not recoup the full loss.

Persaud pleaded guilty in February 2016 to one count of false statements after being indicted in October 2015 on three counts of false statements and three counts of wire fraud. The government and Persaud agreed the total loss suffered by the victims amounted to $1,206,470. U.S. District Court Judge Sylvia H. Rambo ordered Persaud to pay restitution in that amount and imposed a $1,206,470 forfeiture.

“This wasn’t a simple oversight; it was a calculated deception,” said a source within the U.S. Attorney’s Office for the Middle District of Pennsylvania. “Persaud knowingly profited from the Navy’s trust while leaving hardworking subcontractors high and dry.” Persaud was ordered to report to the Bureau of Prisons on November 21, 2016.

The investigation was a joint effort by the U.S. Naval Criminal Investigative Service and the Defense Criminal Investigative Service. Assistant United States Attorney Kim Douglas Daniel prosecuted the case. Grimy Times will continue to follow this case and report on further developments in federal fraud schemes.

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