Second Business Owner Enters Guilty Plea as Part of Ferguson Bid Rigging Scheme

A businessman from Northville, Michigan entered a plea of guilty as part of the ongoing federal investigation into fraud, money laundering, and obstruction of justice involving the Garden View Estates public housing project in Detroit, Michigan, United States Attorney Barbara L. McQuade announced today.

U.S. Attorney McQuade was joined in the announcement by Andrew G. Arena, Special Agent in Charge of the Detroit, Michigan office of the Federal Bureau of Investigation, Breck Nowlin, Special Agent in Charge, Office of Inspector General, Housing and Urban Development (HUD-OIG) and Randall K. Ashe, Special Agent in Charge, Environmental Protection Agency, Criminal Enforcement (EPA-CE).

RODNEY BURRELL, age 57, of Northville, Michigan entered the guilty plea in United States District Court before Judge David M. Lawson.

According to court documents, the activity involved falsely inflated project bid documents submitted in the name of BURRELL’s company called R & R Heavy Haulers. Last month, a second defendant named Brian Dodds also pleaded guilty to participating in the same bid rigging scheme on behalf of his company D & R Earthmoving.

The false bids were created at the direction of Bobby Ferguson and were used as part of a dishonest scheme to make it appear that the $11.9 million bid submitted by Bobby W. Ferguson’s company Ferguson Enterprises, Inc. was the "lowest" bid presented to perform demolition, earth work, and utilities installation at the Garden View Estates project. The Garden View Estates development is a large-scale, multi-use public housing project being developed by the U.S. Department of Housing and Urban Development and the Detroit Housing Commission.

In return for allowing the false bid to be submitted in the name of his company, RODNEY BURRELL and R & R Heavy Haulers received a subcontract from Bobby W. Ferguson worth more than $180,000. In February of 2009, RODNEY BURRELL provided misleading and incomplete testimony to federal law enforcement agents and to a federal grand jury in an effort to conceal the commission of the underlying conspiracy to defraud the United States.

"Fraud in the bid process has no place in city government," McQuade said. "The citizens of Detroit deserve better, and we will continue to prosecute cases like this one to deter others from cheating the public."

Andrew Arena, Special Agent in Charge, Federal Bureau of Investigation said, "This plea is a result of the continuing investigation into the corruption and fraud that has long plagued the City of Detroit. The FBI, with our law enforcement partners, will continue to investigate and expose the individuals who participate in these schemes involving blatant greed."

Breck Nowlin, Special Agent in Charge, Office of Inspector General, Housing and Urban Development said, "Hope VI program, through revitalization and demolition of severely distressed housing, serves a vital role in the HUD efforts to transform Public Housing in the hardest hit communities, communities like Detroit. The charging of Mr. Burrell sends a very clear message that the U.S. Attorney’s Office and federal law enforcement will put a stop to the abuse of such programs, including holding responsible those who allow it to happen."

Under the plea agreement, BURRELL faces up to six months of imprisonment and a fine of up to $5,000.

This case is being prosecuted by Assistant United States Attorney Bruce Judge.