Operator of South St. Paul Trucking Companies Indicted for Defrauding Drivers Into Paying Back Settlement Funds
|U.S. Attorney’s Office December 22, 2010|
The operator of Danner, Inc., and Bull Dog Leasing, Inc., was indicted today in federal court in Minneapolis for allegedly defrauding contracted truck drivers into returning to him settlement funds they received pursuant to an agreement between him and the Minnesota Department of Transportation ("MnDOT"). Marlon Louis Danner, age 66, of Inver Grove Heights, who operates the two South St. Paul companies that supply trucks and drivers to road construction projects throughout Minnesota, was charged with six counts of wire fraud, four counts of mail fraud, and one count of making a false statement. The indictment alleges that from February through June of 2010, Danner operated a scheme to reclaim money he agreed to distribute to truck drivers as part of a settlement between him and MnDOT.
In 2008 and 2009, independent truck drivers operating through Danner's trucking companies worked on the Minnesota Highway 120-Century Avenue reconstruction project. The project was partially funded with federal funds. As a result, Danner was required to pay a mandated truck rental rate to the drivers hired for the project. The allocation of the funds was overseen by MnDOT and the Federal Highway Administration.
Authorities subsequently investigated Danner's compliance with the truck rental rate and determined he had underpaid the drivers. In February of 2010, MnDOT reached a settlement with Danner regarding the underpayment. As part of that settlement, Danner agreed to pay more than $185,000 to approximately 27 truck drivers and arranged for checks to be provided to MnDOT for distribution to those drivers. MnDOT mailed the checks out on March 2, 2010.
On February 27, 2010, however, Danner allegedly telephoned many of the drivers, instructing them to return the settlement funds to him. He purportedly told the drivers MnDOT had made a mistake in concluding they were underpaid. Thus, the funds they were about to receive were not theirs to keep.
Consequently, from March through May of 2010, many of the drivers contacted Danner's office manager for information on how to return the settlement funds. The office manager, acting on Danner's instructions, reportedly directed the drivers to make payment in the settlement amount to various companies controlled by Danner. The drivers then were allegedly provided with false receipts for those payments. The receipts indicated the money was for fuel, rent, or shop repairs, so as to conceal that the settlement funds were being returned. By June 3, 2010, Danner had received more than $120,000 of the approximately $185,000 in settlement funds he originally provided to MnDOT. Danner did not disclose the repayments to MnDOT.
If convicted, Danner faces a potential maximum penalty of 20 years on each wire and mail fraud count, and five years on the false statement charge. All sentences will be determined by a federal district court judge.
This case is the result of an investigation by the Federal Bureau of Investigation, the MnDOT Labor Compliance Unit, and the U.S. Department of Transportation-Office of Inspector General. It is being prosecuted by Assistant U.S. Attorney Nancy E. Brasel.
An indictment is a determination by a grand jury that there is probable cause to believe that offenses have been committed by a defendant. A defendant, of course, is presumed innocent until he or she pleads guilty or is proven guilty at trial.