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Honored Vietnam Veteran now a Discriminated Victim of Fraud

Organized by: Bill Petty

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At his trusted friend's advice, when John came to me 18 months ago he was a complete stranger. He was soft spoken, humble, God fearing, and, obviously to me, he had been abandoned and needed my help. Although I considered myself to be a loyal federal contractor eager to give contract advice, I learned the day I met him that I had a stronger reputation than I had realized as an advocate for small businesses - especially those small businesses victimized by unfair practices. John had been victimized by unthinkable, racially motivated, discrimination.

Although he came to ask me an urgent but basic business question, after we dove into the circumstances of his question, I was shocked. My new friend, a business owner of a Service Disabled Veteran Owned Small Business "SDVOSB" and a socially-economically disadvantaged businessman, was the unsuspecting prey of large-business fraud - prolonged intentional, unscrupulous business practices were threatening his 35-year company.

The unethical and illegal conduct then spanning continuously for more than three years is now in the care of the federal judiciary system - where justice imminently awaits him.  

The day he and I met, our entire meeting time was scheduled as a routine thirty-minute Q&A session. Had his issues been routine,  we may not even remember each other's names or hold a vague memory of the meeting. However, due to the nature of his situation, we met late into that night and, invariably, we've met or spoke every single day since that first day.

Our private and professional lives have radically changed forever. Our inseparable friendship based upon trust, empathy, and mutual respect, has become the foundation for his hope and my faith.

As he explained it, three years earlier, his Serviced-Disabled small business had been awarded government contracts valued at more than ten million dollars. It was the happiest day of his life. He had finally arrived! His biggest previous projects were a size-fractional. He was equally happy to have met the owners of a large business who agreed to help him finance the project, provide training, and help him grow his business. After they signed the contract, instead of honoring its deal, the large business pushed John's company aside, threatened him with bankruptcy, and invoiced him for an amount that exceeded John's own contract amount with his client. Although he could have prevented some or most of it, John was unaware of his rights or his protections. The further we dug into the methods his partner used to administer his contract, the more regulatory violations and unlawful conduct we were able to uncover. In my thirty-four years of government contracting, I have never seen such brazen illegal activity - especially that which was habitually accompanied with the stench of racial and social discrimination.

These past 18 months have been sobering for both of us. Admittedly, the depth and degree of racial prejudice has been more eye-opening and appalling to me as a Caucasian than to John as a non-Caucasian. But the gripping reality of blatant white-collar crimes motivated-by-greed-and-orchestrated-through-deceit-and-disrespect has crippled our faith, equally, in government contracting programs Congress designed to the sole benefit of the disadvantaged small business.

Sadly, my new friend is victim of a fraud scheme for which the public is rarely, if ever, made aware. Why? Until we methodically dug into his contract with the fraudster, my friend John, otherwise an excellent contractor, was inexperienced with complex federal regulations and naïve about acts of fraud. His trusting personality is deeply embedded into his spirit and it cannot be separated from him even in his darkest hour. He trusts to his terminal detriment.

John trusted his partner who said all of the right things - and they made promises with the most eloquent speech - up until the day the contract was signed.

These frauds go undetected due in large part to inexperience with federal contracts. Furthermore, the small business victim has a natural aversion to reporting crimes against it to the media. Small businesses are too often perceived as the villain and the troublemaker. Headlines in many metropolitan areas are far less sexy when the finger is pointed at the large firm. He's the hero, remember? Without him, the small business is nothing. Headlines don't blame heroes.  

Conversely, small businesses are often perceived as the real problem because small businesses cannot perform. Small businesses cannot win projects on merit. When a small business wins a government project, the public sees the award based not on ability. Rather, the public sees the basis for award as a gift from the government. When the basis for award is based upon any criteria other than specific trade expertise such as an unrelated wartime disability or some unrelated social  disadvantage - then the public and the disappointed bidders often only see the awardee as an undeserving recipient of a government handout. The villain, not the victim. 

These are bona-fide reasons why contract fraud goes unreported and frequently remains undetected. The fact remains, however, as stated earlier, John is my hero and he will be yours too. He has had the natural courage to stand up and fight for his firm. He now has the contract intelligence to do so in a way that will change forever and for the better future contracts with all small businesses who have been similarly violated. The large businesses have a duty to conduct business practices ethically and in full compliance with all federally sponsored programs. 

The only sad deficiency John must overcome, is the reality of his legal fees. The fraud-schemes against my service-disabled colleague will likely continue unless John can afford his remaining legal defenses - which are significant. For the past year I have borrowed from my personal savings, from my retirement account, and from insurance policies to assist John. I have exceeded my ability to provide financial support.  My costs include financing my own staff researchers, outside consultants, lawyers, and forensic accountants. I have also contributed in-kind services sacrificing my own day-to-day business earnings by instead working full-time for John's sake. We have also helped to keep John's business alive pending the outcome of the on-going legal battle.

Unlike John, I have not found courage when I need it most. I have not yet found the courage to tell John that I my personal and business financial condition has been equally compromised. This news will devastate him because and, although he is not, he will unselfishly feel responsible for my situation. I made these sacrifices on my own accord. My friend John is well past his well-deserved retirement age, cannot retire.

100% of his assets are being withheld pending resolution of this case. John placed his entire net worth into the hands of dishonest and unprincipled businessmen based on their deceivingly convincing and unconditional promises to teach him everything they know and to take good care of him. Instead of honoring their commitments, they cheated, lied and embezzled his well-deserved profits.

Although it is an additional burden on my financial condition, for your financial support, I am willing to match dollar-for-dollar up to $75,000 for contributions made on behalf of this wonderful man. His service to our country ended in his disability but also in his honorable discharge. He continues to serve his church, his family and his community with the same unselfish commitment and loving spirit he unquestionably gave to each of us when he was a young soldier.

Any amount will help but the foreseeable remaining legal costs will likely exceed $120,000. If you can give, God Bless you. If you cannot give money, please offer prayers for his speedy relief. 


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