Nuvo Construction joins Ganos in reaching deal to plead guilty in Sonag case

Listen to this article

Nuvo Construction has agreed to plead guilty to a conspiracy charge in a probe accusing both the company and the founder of Sonag Construction, Brian Ganos, of bilking the federal government of millions by exploiting set-aside contracts.

Nuvo’s guilty plea results from a deal reached with prosecutors on Tuesday and comes after Ganos had pleaded guilty to two fraud charges on Monday. Ganos was at the center of a years-long investigation that accused him of setting up companies with fraudulent owners, such as Nuvo, to win contracts meant for companies owned by women, minorities and veterans. The scheme ultimately netted the companies more than $200 million in state and federal contracts, prosecutors argue.

Under its plea deal, Nuvo has agreed to plead guilty to one count of conspiracy in exchange for prosecutors’ dropping eight other charges listed in a 25-count indictment that also names Ganos, Sonag Construciton and the accountant for the company, Mark Spindler.

Ganos could be faced with up to 6.5 years in prison and will forfeit millions worth of cash and other assets seized during the investigation, according to his deal with prosecutors. He is scheduled to appear at a sentencing hearing on Friday. Four other people have already pleaded guilty to charges related to the investigation, including people who acted as owners of companies that Ganos secretly controlled.

Prosecutors have agreed to not seek a fine against Nuvo as long as the company takes steps to resolve any related civil lawsuits against it and cooperates in any future civil cases. The company, for its part, has agreed to pay a fine imposed at sentencing and not contest any future attempts by government agencies to bar it from bidding on public contracts. A plea hearing in the case is scheduled for June 14.

Although Sonag Construction has shut down under the weight of the federal indictment, Sonag Ready Mix is still operating without Ganos leading it. Nuvo, likewise, appears to be shutting down, according to court documents. The company, however, was working to transfer its remaining contracts to another firm led by former executives.

Nuvo, according to documents filed in April, had moved to transfer $150,000 worth of outstanding work at Mendota Mental Health Institute’s Lorenz Hall in Madison to a company called JMJ Construction, which was established in June 2018. Nuvo also was moving to pay JMJ nearly $700,000 for the transfer of the related contracts, a sum that would cover the company’s “service fee” and the cost of hiring existing employees. Company officials then denied that there was a connection between the two firms. Follow @natebeck9