Kansas entrepreneur convicted of fraudulently taking millions of federal dollars for disabled vets

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Matt McPherson, owner of Topeka, Kansas, McPherson Contractors, is heading for a project entrance in June 2019. McPherson who pleaded guilty to a scheme involving companies defrauding the government by receiving $ 346 million for contracts reserved for veterans and minorities, was sentenced on Thursday, January 6, 2022. (Thad Allton / The Topeka (Kan.) Capital-Journal)

TOPEKA, Kansas (Tribune News Service) – A Kansas contractor was sentenced Thursday to two years and four months in prison for a federal crime related to a scheme that defrauded the federal government.

Matthew C. McPherson, 45, also confiscated $ 5,516,786 from the government, which represented his share of the proceeds of the fraud, said Teresa Moore, United States attorney for the Western District of Missouri.

McPherson was the owner of Topeka-based McPherson Contractors when he cheated to secure contracts between 2009 and 2018 that should have been awarded to companies run by disabled veterans and racial minorities, of which he is neither the neither, prosecutors said.

“His greed and deceit allowed him to enrich himself at the expense of disabled veterans and minority homeowners,” Moore said. “After losing over $ 5.5 million to the government and sent to jail, he learned the hard way that crime doesn’t pay.”

“Today’s condemnation sends a clear message that entrepreneurs who enrich themselves unjustly at the expense of our country’s veterans will not be tolerated,” said Gavin McClaren, Acting Special Agent in charge of the Central Office of the VA Inspector General’s office.

McPherson pleaded guilty in June 2019 to one count of conspiracy to commit wire fraud and major program fraud.

The crime was linked to a scheme in which prosecutors said construction companies defrauded the government by receiving $ 346 million.

McPherson admitted in argument that he was involved between September 2009 and March 2018 in a conspiracy to obtain contracts reserved by the federal government to be awarded specifically to small businesses owned and controlled by military veterans, disabled veterans and certified minorities.

McPherson owned a construction company that was not eligible to compete for those contracts, prosecutors said. The type of plan involved is often referred to as “Rent-A-Vet” or “Rent-A-Minority” fraud.

Prosecutors said McPherson and his co-conspirators – Matthew Torgeson, former chairman of Topeka’s Torgeson Electric Co., and Kansas City-area businessman Patrick Michael Dingle – controlled and operated Zieson Construction Co.

This business was formed in 2009 with Stephon Ziegler, 61, of Weatherby Lake, Mo., a disabled black veteran, as the nominal owner.

Zieson’s main business was securing federal construction contracts for small businesses owned and controlled by disabled veterans or certified minorities, prosecutors said.

However, they said, Ziegler did not control Zieson’s day-to-day operations or long-term decision-making.

McPherson and his co-conspirators actually controlled and operated Zieson, and received most of Zieson’s profits, prosecutors said.

They alleged that Zieson between 2009 and 2018 received approximately $ 335 million under approximately 199 federal contracts to be awarded to small businesses owned by veterans and minorities.

McPherson and his co-conspirators also started another company owned by Zieson employee and Native American Rustin Simon, 45, of Smithville, Missouri, which fraudulently grossed more than $ 11 million through two federal contracts, said prosecutors.

Torgeson died in November 2019.

Dingle, 50, of Parkville, Missouri, awaits sentencing after pleading guilty in September 2020 to one count of conspiracy to commit major wire and program fraud. He also pleaded guilty, in a separate case, to one count of filing a false income tax return.

Ziegler is awaiting conviction after pleading guilty in May 2019 to making a false statement to the US Department of Veterans Affairs.

Simon is awaiting conviction after pleading guilty until June 2019 to two counts of making material misrepresentation to the Small Business Administration.

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(c) 2022 The Topeka Capital-Journal, Kan.

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