Citing the statute of limitations, a federal judge has thrown out two charges against two Little Rock men accused of falsely claiming a construction company they operated was headed by a service-disabled veteran in order to receive millions of dollars in government contracts.
The dismissal of two counts of major fraud against Ross Alan Hope and Mikel Kullander still leaves each of the men facing three counts of major fraud, 24 counts of wire fraud and one count of wire-fraud conspiracy. Kullander also faces an additional charge of making a false statement. They are set to be tried by a federal jury beginning Sept. 5.
Hope and Kullander, both 56, were indicted Dec. 7 by a federal grand jury in the Eastern District of Arkansas in connection with their association with DAV Construction in North Little Rock. Hope was president of Powers of Arkansas, which he said contracted with and shared office space with the construction company on Northshore Drive, while Kullander was vice president of both DAV and Kullander Construction Inc. in Little Rock.
The indictment alleges that the men conspired from 2007 until August 19, 2015, the day federal agents executed a search warrant at the construction company, to defraud the government by making it appear that "J.W.," a former employee of Hope's who is a 100 percent service-disabled veteran, owned the majority of the company, received at least 51 percent of its profits and controlled its day to day operations and long-term decision making.
The indictment said J.W., however, had admitted to the Veteran's Administration's Center for Verification and Evaluation that he had quit working at Powers of Arkansas after 20 years because of his disability, and only went to meetings on an "as-needed" basis.
A 2006 law allows veterans with service-related disabilities to be part of a government contracting network, but the veteran must own at least 51 percent of the business, receive 51 percent of the profits, and control the company's day-to-day management, operations and long-term decision making. Neither Hope nor Kullander are veterans, let alone service-disabled veterans.
The Secretary of State's office shows that DAV was incorporated on Sept. 19, 2007, with James Wells listed as president, Hope as secretary and treasurer, and Kullander as vice president.
U.S. District Judge Leon Holmes agreed Friday with defense attorneys Tim Dudley and Jane Duke that two of the major fraud charges concerned government contracts that were awarded on March 31, 2009, and July 30, 2009, and that the seven-year statute of limitations accordingly required that charges concerning those contracts had to be filed by March 31, 2016 and July 30, 2016, respectively. The charges weren't filed until Dec. 7, 2016.
The charge of major fraud applies in cases involving contracts of at least $1 million.
Federal prosecutors argued that the crimes weren't completed until Hope and Kullander later accepted and signed for contract modifications, which would bring the offenses within the seven-year period. Alternatively, they argued that the offenses were "continuing offenses" that continued until they were modified.
The contract awarded March 31, 2009 was for $3,082,000 and was modified on Sept. 14, 2010, for a total of $3,142,560. The contract awarded on July 30, 2009, was initially for $5 million, but was increased on June 21, 2009 to $5,103,800.
The other major fraud charges in the indictment involve contracts of $2 million, $1.29 million and $1.26 million that were awarded, respectively, on Sept. 22, 2010; Sept. 13, 2012; and Sept. 11, 2014.
Holmes said the purported crimes involving the 2009 contracts "were complete when the contracts were awarded, so the statute of limitations began to run when the contracts were awarded, not when the contracts were modified." He also rejected the argument that they could be considered "continuing offenses."
Metro on 03/13/2017