Prevailing Wage Fraud Leaves Contractors Clutching their Payroll Receipts
By Miles Davis
In 2009, Earl James Thompson couldn’t obtain a contractor’s license for the UC Davis Tercero Hall Project because his license was revoked from earlier fraudulent activity.
The People claim that, in knowledge of his revocation, Earl Thompson, commonly referred to as EJ by workers, then conspired with his wife, Valery Thompson, and his employee, James Russell, to resolve matters alternatively. The contractor’s license agreement would essentially say that “Valerie and Russell ran the company,” says the prosecution.
Mr. Thompson’s conspiracy would entail Mrs. Thompson and James Russell securing a contracting license for the purpose of pseudo-representation. The contracting license would state that all was in order with proper management until the People presented a violation excerpt stating that “no one that they were related to had ever had a contracting license before,” which was not found to be true.
A violation, of perjury, had been committed, as Valery Thompson was married to Earl Thompson, knowing that he had already had a contracting license which had been revoked. James Russell also played a role in the alleged felonious activity by signing up as a company leader while coordinating Mr. Thompson’s unlawful leadership role on the site.
Mr. Thompson partially acknowledges his wrongdoing and pleads no contest to all counts of perjury. and hopes to convince the court that he should be held to the same standard of scrutiny as his co-defendants. The People v. Thompson trial did not take much time capturing the crude gist of the restitution case.
The prosecution began their opening statement by detailing the events.
“This case is about a con man who has spent his entire life scamming innocent people out of huge amounts of money, living from the hard work of others, and leaving many victims behind as he moves from one scam to another.”
Mr. Thompson obtained the UC Davis Tercero Project contracting license on false pretenses.
Prevailing Wage & Workers Compensation provide for jobs that are paid with public money, and theft of that is theft of public money.
Prevailing wage sets required wages for contractors, with the expectation being that higher wages will allow them to attract and hire a more skilled workforce and thus produce better quality construction for the community. Unfortunately, Mr. Thompson and his counsel didn’t seem to have the same concerns in mind. The defense was generous enough to consider a plea of no contest and to bargain for a lower amount of restitution on the grounds of unfounded evidence of Mr. Thompson conspiring as a ring leader of sorts. Further determinations are to be made after the remaining 9 of 12 witnesses are cross-examined over the next couple of days.
The Vanguard also received the following information in a press release:
In 2009, Earl Thompson and Valery Thompson obtained a $1.5 million subcontract for labor during Phase II of construction of the Tercero Student Housing at the University of California, Davis.
According to a Yolo County District Attorney’s Office filing in 2015, the defendants conspired to steal $633,199.55 of wages from their employees and failed to report payroll of $920,618.41 to their insurance company, causing a loss of approximately $359,000. For many employees, this deprived them of as much as $20,000 that they earned.
The counts the defendant pleaded guilty to were:
PC 182(A)(4), Felony, CONSP: DEFRAUD PERSON (1 count)
LC 1778, Felony, REC WAGES OF WORKMAN (1 count)
PC 484(A)/487(A), Felony, GRAND THEFT (2 counts)
IC 11880(A), Felony, FALSE/FRAUDULENT (1 count)
PC 118(A), Felony, PERJURY (20 counts)
BP 7028(A), Misdemeanor, CONTRACTING W/O LICENSE (1 count)
“By stealing this money, and defrauding the insurance company the defendants were able to significantly reduce their cost of doing business and thereby underbid legitimate companies and harm local workers.”