Cole Hardware Pled Guilty to Involvement in a Procurement Scam to Defraud San Francisco Public Utilities Commission

Monday, February 27, 2012

CONTACT: Stephanie Ong Stillman, (415) 553-1167 or (415) 740-5134
Omid Talai, (415) 553-9272

SAN FRANCISCO, CA – District Attorney George Gascón announced that Cole Hardware pled guilty on February 24 to felony charges in a procurement scam to defraud the San Francisco Public Utilities Commission (SFPUC). As a result of the plea Cole Hardware will be ordered to pay $51,000 in restitution to the SFPUC.

“Our city will not tolerate city vendors who steal taxpayers’ money. We are pleased Cole Hardware has accepted responsibility for their role in this multi-level scheme to defraud the SFPUC,” said San Francisco District Attorney George Gascón.

According to court documents, Cole Hardware is one of 10 co-defendants engaged in a conspiracy to defraud the SFPUC through the use of the city’s vendor procurement system from April 2003 to October 2007. Cole Hardware was one of two vendors working with Donnie Alan Thomas, a former supervisor of the San Francisco Public Utilities Commission who pled guilty last September 2011 for his role in the SFPUC procurement scam. It is alleged that employees of the two vendors knowingly submitted invoices to the SFPUC with false descriptions of items purchased. The false invoice descriptions allowed Thomas to conceal the fact the he was purchasing items of personal benefit.

"Today we have sent a strong message that the City will not tolerate public servants or vendors who attempt to fleece our hardworking taxpayers," said SFPUC General Manager Ed Harrington.

Cole Hardware pled guilty to two felony counts: one violation of Penal Code § 487(a) (Grand Theft) and one violation of Penal Code § 470(d) (Altered/Forged Requests for Payment). Cole Hardware will pay restitution to the San Francisco Public Utilities Commission (SFPUC) in the amount of $51,544.72. Cole Hardware will also have to pay approximately $650 in fines and fees to the court. Cole Hardware is scheduled to be sentenced on March 23, 2012 in Department 28.

There are six other co-defendants who have already pled guilty in this case: Donnie Thomas, Jean Quiroz, Centennial Distributors, Inc., John Rauch, Robert Mazariegos, and Vincent Padilla. There are three other co-defendants who have not yet pled guilty and who await their preliminary hearing: Miles Bonner, Tri-Delta Electric, and Elizabeth Bradford.