MIAMI (CBS4) Five former Wackenhut Corporation managers have been charged with fraud for allegedly billing Miami-Dade County for “Ghost Posts.”

Miami-Dade police department’s Public Corruptions Investigations Bureau began looking into Wackenhut’s actions in November 2006 when allegations were made that they were billing the county for hours when guards were supposed to be at their posts, but were not – a condition referred to as a “Ghost Post”.

From 2002-2005, investigators found Wackenhut billed the county in excess of $76,000 or roughly 3,500 service hours, which were not performed. Investigators said they believe this was just the tip of the proverbial iceberg and that the actual fraud committed by Wackenhut management/employees was somewhere between 3 and 6 million dollars based on an audit conducted by Miami-Dade County’s Audit Management Services.

“They were cheating the taxpayer not only of money but of security,” Miami Dade State Attorney Katherine Fernandez Rundle told CBS4 News. “It is once again an example of how the Metro Dade Police Department and this office are not going to tolerate that.”

The five individuals arrested were: Elijah Pendleton, 67; Roberto Pereira, 45; William Acosta, 43; Robert Alvarado, 42 and 50-year old Nathan Holmes. Each was charged with a single count of racketeering.

Pendleton was the project manager for Wackenhut who oversaw the lucrative five-year contract.

In addition to billing for posts which were not manned, investigators said they also found instances when Wackenhut would bill the county for full hours when their guards left early, when guards left their assigned posts to relieve other guards and when Rail guards were positioned at stationary posts to alleviate shortages. In the latter two circumstances, the county was reportedly billed full hours for two positions.

Det. David Colon said the problems for Wackenhut began in 2002. According to Colon, Wackenhut did not have the manpower to cover all of the transit stations and the company feared that if county officials found out, Wackenhut would be fined or possibly even lose the contract.

“So it was very important for Wackenhut to submit paperwork that made it appear that posts were being covered when in fact they weren’t and people were being paid when in fact they were home,” Colon said.

Colon made clear that detectives believe others within Wackenhut’s management — above Pendleton — knew what was taking place.

“It is an ongoing investigation,” Colon said. “We have reason that he is not the highest person within the organization of Wackenhut that knew and authorized for this to continue.”

Jeff Foreman, Wackenhut’s attorney, denies the company did anything wrong.

“We’re confident at the end of the day that Wackenhut corporation will not be charged with any wrongdoing and that no Wackenhut management is complicit in any wrongdoing that’s being charged against these five individuals,” Foreman told CBS4 News. “I’ve read the allegations, I’m familiar with the background and the investigation, and there is nothing in anything that we have seen that the management of this company had any inkling that there was fraudulent activity going on.”

The company issued a separate statement:

“We are confident that the facts will show that the company and its management did nothing wrong. Wackenhut does not, and never has condoned any wrongdoing. If any of the former employees are guilty of these allegations, then they have stolen from both Wackenhut and the County. Many of these allegations relate to a County Audit conducted between 2002 and 2005 that a Federal Judge found to be flawed and unreliable. We are surprised that investigators have used it as the basis for their allegations. Public safety on Miami-Dade Transit was never at risk. Crime declined dramatically when Wackenhut assumed the contract. In fact, major crimes on the Miami-Dade Transit system were at the lowest point in 15 years at the end of 2005. These allegations are completely at odds with the values demonstrated daily by our more than 40,000 employees who strive to deliver the highest levels of service to our customers.”

Rundle said the actions of the Wackenhut employees may not be new or surprising, but they are still disappointing.

“In this particular instance that’s what we have, we have a corporation who had people within it who were cheating on their contract,” she said. “Its unfortunate, its not the first time its happened to county government, it’s not the first time its happened to the taxpayer, I’d like to think it would be the last, I’m sure you would too.”

Jim DeFede

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