On The Money: Water Meter Fraud

Roseville Contractor Accused

By Mike Luery

SACRAMENTO (CBS13) — Tens of thousands of your tax dollars are missing in action. Prosecutors say federal stimulus funds were used fraudulently by contractor Peter Scott of Roseville.

CBS 13 found Scott on his way to federal court, where he is facing fraud charges – including 13 counts of conspiracy and submitting phony documents to land a multi-million dollar contract with the city of Sacramento.

Scott was hired, as CBS 13 first reported in January 2010, to retrofit water meters for homeowners using federal stimulus funds. When authorities discovered the alleged fraud, they pulled the plug on the project.

“The case is a serious one in terms of taxpayer dollars,” said Benjamin Wagner, the U.S. Attorney for the Eastern District of California.

Wagner told CBS 13 the damage could be as high as $100,000 in fraud. He is prosecuting Peter Scott and his nephew Robbie Scott.

Many of the former workers from Advantage Demolition and Engineering say the Scotts owe them thousands of dollars for work they completed, but were never paid for.

“It’s $35,000. He wrote me, they wrote me a check for $5,000 and it bounced,” said Tim Chavez, a former worker.

Daniel Vasquez, another former worker told CBS 13, “It looks like he didn’t really care about us, trying to take off with our money. No answers, no return calls or anything.”

But there were no answers from Peter Scott when CBS 13 caught up with him at federal court in Sacramento.

On The Money asked Peter Scott, “you’re charged with defrauding the city of Sacramento and I want to get your side of the story. What do you have to say for yourself?”

But Scott did not respond, nor did he answer this reporter’s follow up question:

“A lot of folks here think you abandoned the jobs in the middle of the works and left a lot of people high and dry. Don’t you have anything to say in your defense?”

Scott was speechless as he walked into court – and so was his co-defendant Robbie Scott.

“So you’re being charged with defrauding the government. What do you have to say for yourself? Anything in your defense?” this reporter asked Robbie Scott.

Scott just kept on walking. Robbie and Peter Scott could face significant time behind bars if found guilty.

“There’s multiple counts here. Each one has a 5 year in prison maximum penalty. There’s a fine of $250 thousand dollars,” said U.S. Attorney Benjamin Wagner.

As for the Scotts’ former workers, most received partial payment from the government for the work they did, but they say they’ll be watching this case closely.

“I’m here to see justice served on Peter Scott,” said David Vasquez, another former worker.

Peter and Robbie Scott will be back in federal court on February 23rd for further proceedings on their case.

If you have a story idea about government spending, fraud or waste, send us an e-mail to onthemoney@kovr.com. You can also follow On The Money stories in progress via Twitter at http://twitter.com/#!/mikeluery

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  • Francis

    Wow, this sounds like it’s just a big misunderstanding. After all, what kind of person would defraud the government and us tax payers? Anyone guilty of that should be executed in the street by his neighbors, so, sounds like a misunderstanding, am I right? Or should us tax payers move to start eliminating these types of people?

    • Robin Scott

      you are correct francis…..it is a misunderstanding….this story is not at all as it seems…..!!!!

    • abc

      I’m pretty sure the news blows up stories and tries to make them sound more extreme than they really are. They try to get everyone’s attention by throwing “stealing tax payer’s dollars” in the story.

      Wow, that’s kind of harsh…how about rapist, child molesters and murderers get executed in the streets…and talk about defrauding the government and stealing tax payer’s dollars, we should probably take a look at people milking Welfare, unemployment and Disability benefits.

  • OlDog

    Any thoughts on why they were paid before inspection/completion of work? What City administrators verified payroll records? Did Sac City employees think these turkeys would supervise themselves, or did our dedicated civil servants even care? After all, it’s only federal tax dollars sent here to stimulate spending.

    • Robin Scott

      oldog…..as i said to francis..the story is not as it seems…!!

  • Robin Scott

    Peter Scott is not guilty of anything except being a nice and trusting guy…simple as that..he trusts too much…..!!!!!

  • Robin Scott

    People who live in glass houses, should not throw stones…that is my response to tim chavez and to david vasquez…!!!

  • EPY

    O wow Robin Scott I bet you didn’t mind spend that money your family took for the tax payers. The sad thing is you family doesn’t even pay the worker you are no ROBIN HOOD and either is Peter or Robby. You and your family are very sad people and I hope you get what is coming to you all.

  • simply sarcastic

    sounds to me like “Robin Scott” is really Peter Scott (or a relative). Yes this is a small amount in comparison to all the fraud that is going on but using that as a scape goat is a pathetic excuse! If this panzee was innocent you’d think he would have no problems explaining himself. People want smaller government but then they get upset when a low like like this steals money and they go back to blaming the government. What ever happened to personal accountability?

    • RMF

      No Robin Scott is NOT Peter Scott, relative yes as am I. And because it is a current case being investigated his lawyer has a gag order on all explanations to the media or general public. So until this is settled in court no explanations will be given on any public forum.

  • Robin Scott

    Well…fact is…no money was taken…in fact..peter scott is owed money..the story is completelly wrong…he won’t talk because he has a lawyer and everything he says gets twisted anyway…things are not as they seem,,,i promise that….Peter actually paid out of his own pocket…..the news didn’t mention that did they……???????

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