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Home / Commercial Construction / James Hubbell, convicted of fraud in Sonag scheme, sentenced to 24 weekends behind bars

James Hubbell, convicted of fraud in Sonag scheme, sentenced to 24 weekends behind bars

Cary Spivak
Milwaukee Journal Sentinel

James Hubbell, a longtime associate of Brian Ganos, the imprisoned mastermind of a $260 million contract fraud, will be jailed for 24 weekends for his role in the scheme to win contracts that were earmarked for minorities and disabled veterans, a federal judge ordered Wednesday.

During a sentencing hearing on Wednesday, it was disclosed that Hubbell, after his arrest, cooperated with federal investigators in their probe of Ganos and his now-defunct Sonag Co. Hubbell agreed to plead guilty to conspiracy to defraud in 2018. He is one of six people who have been convicted for their role in the scheme.

“There is no question that Mr. Hubbell cooperated extensively … after the scheme was discovered,” the federal prosecutor Adam Ptashkin said during the nearly 90-minute sentencing hearing conducted via Zoom.

That cooperation and the knowledge that Hubbell was going to testify against Ganos gave Ganos an incentive to avoid a trial and plead guilty, Ptashkin said.

Ganos, 59, pleaded guilty to fraud charges last year and was sentenced to a 6 1/2-year prison sentence. Hubbell faced a maximum sentence of nearly five years in prison.

In a sentencing memorandum, Michael Steinle, Hubbell’s lawyer, noted that “after arrested and prior to indictment, Mr. Hubbell was ready, willing and eager to admit his involvement in the Ganos scheme.”

In imposing the sentence that also included three years probation and 200 hours of community service, U.S. District Court Judge Pamela Pepper noted that Hubbell’s cooperation did not come until after his arrest.

“When law enforcement showed up (at the Sonag offices) he didn’t tell the truth,” Pepper said. “He knew he was not telling the truth.”

Agents from the FBI and other law enforcement agents talked to several employees of Ganos companies, including Hubbell, who supervised construction projects and was purported to be part owner of C3T Inc., a construction company that was certified as being owned by a service-disabled veteran. In reality, the veteran had no involvement in C3T, according to court documents.

Today, Hubbell, a Navy veteran, said he is trying to make amends for his crimes.

“What you see is a man who wasted a 25-year professional career,” he told Pepper.

Hubbell said he could no longer do construction work on government projects and instead employs himself, describing himself as “essentially a day laborer.”

Pepper said that although some see the Sonag scheme as a victimless crime, she disagreed.

“There were victims,” Pepper, the chief judge in the Eastern District of Wisconsin, told Hubbell. “There were real human beings who didn’t get contracts.”

The set-asides programs are designed to “help people who don’t have a level playing field … get a foot in the door,” the judge said.

The Ganos scheme, which included using straw owners of companies eligible for government programs, dates to about 2004. It started after Ganos, who is Hispanic, graduated from the set-aside program but secretly controlled companies that continued to receive set-aside government jobs.

In its heyday, Sonag was a well-known construction company that helped build several well-known projects including Fiserv Forum and Northwestern Mutual’s downtown business tower. It also captured millions of dollars worth of government jobs, including work at State Fair Park in West Allis, Truax Field in Madison and the Scott Air Force base in Illinois.

Call Cary Spivak at (414) 550-0070 or cspivak@jrn.com. Follow him on Twitter at @cspivak or Facebook at facebook.com/cary.spivak.

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