Three People Arrested In State Contract Fraud Scheme

SACRAMENTO (CBS13) - Three people, including two state employees, have been arrested in a scheme that misappropriated thousands in taxpayer money.

State Attorney General Kamala Harris announced the arrests Tuesday in a statement. In it, she alleges Michael Mathison, 50, of San Pedro, who owns Veteran Toner Services, allegedly submitted inflated quotes for office supplies to the Department of Fish and Wildlife and Caltrans. He then submitted even higher quotes from fake companies. And in return for giving Mathison's company the contract, two state employees were given kickbacks in the form of gift cards and vacations.

Stephanie Clark, 42, of Fair Oaks, Danny Gray Compson, 62, of Yuba City and Mathison were arrested Tuesday. All three suspects face charges of bribery, conspiracy and misappropriation of state funds. Clark and Compson also face charges of embezzlement by a public officer.

"These workers conspired to defraud taxpayers for personal gain," said Attorney General Harris. "We take government fraud very seriously. I thank our state partners for working closely with Department of Justice agents on this case."

Clark works at the Department of Fish and Wildlife. Over the last five years, he allegedly took more than 50 bribes totaling $23,800.

Compson, a Caltrans employee, allegedly accepted bribes from Mathison and submitted invoices worth $5,000 per week to be paid, but never received the product.

Clark and Compson were arrested and booked into Sacramento and Sutter County Jails on $75,000 bail each. Mathison was booked into the Los Angeles County jail on $250,000 bail.

The arrests come after a year-long investigation that started with an anonymous tip.
The investigation is ongoing.