‘We are all left paying the bill’: Stoneham police officer arrested for $36 million fraud scheme
A Stoneham police officer and his brother have been indicted by a federal grand jury for defrauding a vendor company for tens of millions of dollars of funding.
48-year-old Joseph Ponzo, a full time Stoneham Police Officer and his brother, 47-year-old Christopher Ponzo, who owns an electrical contracting company, were arrested this morning and appeared in federal court on Friday afternoon.
From 2013 to 2017, the brothers conspired to bribe an associate of a Mass Save lead vendor company that netted the pair millions of dollars in Mass Save contracts.
The Ponzo’s paid this associate in home bathroom fixtures, a computer, free electrical work, and a John Deere tractor in addition to weekly cash bribes ranging anywhere from $5,000 to $10,000. In exchange, the brothers received a procurement of over $36 million in Mass Save contracts with the vendor company.
Mass Save is a program that is designed to help Massachusetts residents manage their energy and utility costs.
“Virtually every Massachusetts resident who uses energy is surcharged and pays for Mass Save,” said United States Attorney Rachael S. Rollins, “these payments are mandatory and amount to hundreds of millions of dollars.” Rollins continued, saying in part, “Defrauding the Mass Save program for millions of dollars means we are all left paying the bill. It is corruption at its core and will not be tolerated.”
The associate also assisted the Ponzo’s in creating companies to serve as vendors and contractors under the Mass Save program. One such company, Air Tight, performed insulation work. Joseph Ponzo put his spouse’s name on Air Tight incorporation documents and licenses to hide his involvement in the corruption. Ponzo allegedly collected millions of funds through AirTight, despite having no professional experience as an insulation worker.
“Mass Save is all about providing consumers, who qualify in the Commonwealth of Massachusetts, with low or no-cost energy-efficiency projects for their homes,” said Joleen D. Simpson, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigations in Boston. “The fact that a member of law enforcement who pledged an oath to protect the community allegedly abused this program as a get-rich scheme is particularly reprehensible. Today’s indictment begins the path to ensuring integrity in this program and should serve as a clear warning to those who are attempting to defraud it.”
The Ponzo’s were indicted on one count of wire fraud conspiracy and 12 counts of wire fraud. These charges carry a maximum of 20 years in prison, up to three years of supervised release and a fine of up to $250,000.
Stoneham Town Administrator Dennis Sheehan and Police Chief James McIntyre said in a statement, “The indictment concerns allegations regarding the employee’s outside business interests, and is not connected to his work as a Stoneham Police Officer. The allegations in the indictment do not represent the values of the Stoneham Police Department or its members.”
As a result of the indictment, Officer Joseph Ponzo has been placed on administrative leave.
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