Two men connected to a Long Island contracting company have been sentenced in federal court for carrying out a scheme that allowed them to dodge paying union benefits to truck drivers for years — a case that highlights how construction fraud can siphon millions from workers and taxpayers alike.

On July 11, 2025, Frank Lizza, the former owner and officer of Intercounty Paving Associates, LLC, was sentenced by the U.S. District Court for the Eastern District of New York to six months of home confinement and 12 months of supervised release for his role in the conspiracy.

Ramon De Los Santos, a former employee at Intercounty, was also sentenced on the same day to 12 months of supervised release for his involvement.

Both Lizza and De Los Santos pleaded guilty in October 2023 to lying to the Federal Aviation Administration (FAA) about the company’s payroll records.

In outlining how the fraud worked, the U.S. Department of Transportation’s Office of Inspector General (DOT-OIG) described it this way:

“Between approximately June 2014 and September 2018, Lizza, De Los Santos, and others submitted certified payrolls to FAA and the Port Authority of New York and New Jersey, intentionally omitting hours worked by drivers for LR Safety Consultants & Construction Services, LLC (LR Safety), a unionized company under their control. To avoid paying required union benefits for employees of LR Safety, they transferred a portion of the hours worked to 4L Equipment Leasing, a non unionized company Lizza owned and operated that supplied trucks and drivers for Intercounty’s contracts.”

By shifting hours from a union company (LR Safety) to a non-union shell company (4L Equipment Leasing), the conspirators avoided paying union health and pension benefits that their workers were entitled to under collective bargaining agreements — giving them an unfair advantage over legitimate contractors who follow the rules.

In addition to their supervised release sentences, both men were ordered to pay $49,362 in joint restitution, and they could still owe additional payments to the Internal Revenue Service (IRS) for tax fraud tied to the same scheme.

The multi-agency investigation, which remains open, is being led by the DOT-OIG, the IRS Criminal Investigation Division, the Department of Labor OIG, and the Port Authority of New York and New Jersey OIG.

The case is part of a broader federal push to crack down on wage theft, bid rigging, and other fraud that undermines unions and costs taxpayers millions on public projects. Construction watchdogs say fraud schemes like these not only cheat workers out of fair pay and benefits but also tilt the playing field against honest contractors who comply with labor laws.

For now, authorities urge other contractors and workers who suspect similar misconduct to come forward and report suspected payroll fraud, wage theft, or union benefit avoidance to federal or local labor investigators.

Originally reported by CDL LIFE.