A former vice-president of American consultant MGT Construction has been sentenced to 27 months in jail for covering up a $20m debt.
The company offered planning and construction management services in the state of Virginia, and from 2011 to November 2016 Patrick Lindsey was in charge of the day-to-day operation of its accounting department.
According to the US Department of Justice, Lindsey concealed the company’s debt through "job-cost manipulations" in its accounting system, inflating profit margins and concealing losses by moving or deleting thousands of invoices.
This resulted in fraudulent applications to banks and insurance companies for lines of credit and bonding coverage.
MGT Construction filed for Chapter 7 bankruptcy in early 2018, leaving many contractors, subcontractors and vendors out of pocket.
Raj Parekh, acting attorney for the Eastern District of Virginia, said: "Over a five-year period, Patrick Lindsey served an integral role in a large-scale corporate accounting fraud scheme designed to conceal the fact that MGT Construction was more than $20m in debt.
"That deceit not only maintained the defendant’s job and padded his annual compensation package, but it also proved devastating to the individuals who worked on MGT Construction projects and were left holding the bag after the fraud scheme was uncovered and the company subsequently collapsed."
Image Â©GCR, illustration by Denis Carrier