Newark contractor faces fraud claims amid lead pipe replacement

Company replacing lead pipes in NJ accused of fraud

The company hired to replace lead pipes in Newark are now being accused of fraud. Despite the allegations, Newark officials say the water is safe. FOX 5 NY’s Stephanie Bertini has the latest on the fraud allegations the company is facing.

NEWARK - A construction company hired to replace lead pipes in Newark is now being accused of fraud, according to federal authorities.

According to the criminal complaint, Michael Sawyer, the CEO of JAS Group enterprise, and Latronia Sanders, an employee, committed wire fraud by intentionally misleading the city of Newark. Authorities have arrested Sawyer and Sanders.

Investigators said the company hired to replace lead pipes in water service lines didn't complete the work and reported it wasn't necessary while sending Newark a bill for the work.

The fraud totals over $10 million.

"As the investigation went on, anything that we found we changed it immediately. We are very comfortable given that we went through thousands of documents, went out and investigated hundreds and hundreds of lines and wherever we saw lead, we changed it," Newark Mayor Ras Baraka said.

Baraka wants people to know the water supply was never affected.

"There was no time that the residents were in any danger whatsoever from having lead leach into their lines from, unfortunately, pieces of lead pipe that were left in the ground by, unfortunately, a contractor, who did some very unscrupulous and terrible things," Baraka said.

In a statement, the US attorney for the District of New Jersey said:

"By causing misleading photographs and verification forms to be submitted, Sawyer and Sanders concealed that they intentionally did not replace lead pipes and defrauded Newark by collecting payment for work they did not properly perform."