Lehr Construction Corp renovated office buildings in NYC and ran a scheme that reportedly cheated $30M from their customers. Working for marquis clients like Fidelity Investments and The Economist magazine, Lehr ran an over-invoicing scam.

Lehr utilized both an open book,  Construction Management side of the company that worked on a percentage mark-up on costs along with a General Contracting side that worked at lump sum bids. The management colluded with selected sub-contractors to inflate their invoices on the CM projects, then to low ball the GC projects. Therefore Lehr over-billed their CM customers (and increased their CM fees) while being able to obtain much more GC work at better margins.

I’m not sure the old adage that cheaters never win is always true, but it’s mostly true. These stinking cheaters got caught (and went bankrupt as well) and are going on trial. The charge of enterprise corruption carries a jail term of 25 years. The VPs of finance, operations and estimating are all on the hot seat.

How do guys like these not expect to be caught? Is the arrogance that high? Or just the stupidity? These are crimes with lots of other parties involved. People, for the most part, don’t keep secrets well.

“Sadly, greed and corruption impose a hidden, billion-dollar-a-year tax on New York City’s construction industry,” said New York District Attorney Cyrus R. Vance Jr., whose office is investigating the industry.

These cheaters didn’t win. Even the other guys who haven’t gotten caught have to go through life knowing they are scum balls. I encourage you not to just take the high road, but take the highest road. Behave in such a way that even the appearance of impropriety is absent. Set your personal standards so high that everyone who works with you or knows you has a clear sense of your high integrity. Live like somebody is always watching…because it’s true.