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Hurricane Sandy debris removal scams have feds worried

When people think about the impact of a superstorm or a hurricane they typically think about the damage inflicted upon people’s homes as well as their communities. They think about rebuilding and creating a new hope. What they don’t consider is all of the rubble (left behind by the storm) that must be cleared away before contractors can even think about setting foundations and paving new roads. It’s not a particularly fun job but it’s a necessary one if the community is ever to regain some semblance of normalcy.

After major tragedies there are plenty of stories of contractors doing the right thing (and sometimes going above and beyond that) to help those in need yet (like every profession), there are those who will abuse their position in order to gain either political leverage or some form of illicit cash flow. That’s exactly what happened in Belmar, New Jersey as federal auditors have recently questioned over $500,000 in Hurricane Sandy debris removal costs, which apparently stem from a suspicious relationship between two firms and a local politician.

Matthew Doherty, the mayor of Belmar, has recently come under increased scrutiny from the federal government. Auditors from the Department of Homeland Security’s Office of Inspector General found that both J.H. Reid of South Plainfield and Ferreira Construction of Branchburg (who both have relations to Mr. Doherty’s wife) accounted for over half of the town’s debris removal costs (roughly $1.6 million dollars in all).

Doherty claims that the costs were substantially higher than they should have been as they were awarded on an emergency basis. Though the costs may have been higher it is not immediately apparent why the federal government has become involved. But, look a little closer at the report and it becomes much clearer. The town of Belmar wants the Federal Emergency Management Agency (FEMA) to cover $285,000 in markups. A price Inspector General has refused to accept on the condition that the firms used a cost-plus-percentage-of-cost method of billing which does not adhere to federal regulations.

Using that method of billing and the relationship to Mr. Doherty’s wife both firms were able to charge a sum that was substantially higher than the norm. With superstorms and hurricanes frequenting the East coast more often towns and local governments should take care to come up with a reasonable plan of action for debris removal that will increase the incentive for contractors to control costs and hopefully result in a much smoother phase of redevelopment. With debris still littered across the tri-state area keep your eyes open for those who may be misusing their power when it comes to clean-up. We would much rather have good contractors such as yourself rebuilding neighborhoods instead of those who may do more harm than good. Happy building!

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David Scott Ruddy Sentenced to Five Years for Sandy Fraud

According to a release published by the NJ Attorney General’s Office, David Scott Ruddy, 32, of Metuchen, was sentenced to five years in prison for conning Superstorm Sandy victims out of approximated $55,000. Acting Attorney General John J. Hoffman’s announcement explained that Ruddy’s scheme took advantage of storm victims by promising low-cost housing and vehicles after they lost everything in the storm. His promises were left unfulfilled, and Ruddy took off with their money.

David Scott Ruddy will be spending the next five years in state prison after Superior Court Judge Joseph A Paone’s ruling in Middlesex County. On October 8th of this year, Ruddy pleaded guilty to third-degree theft by deception, and was ordered to pay restitution to all of his victims. The case was prosecuted and the plea agreement was facilitated by Deputy Attorney General Jillian Carpenter. Sentencing was handled by Deputy Attorney General Janet Bosi.

Ruddy’s scam began when he impersonated a Red Cross worker or law enforcement officer who was helping out at the emergency shelters in Middlesex County. He would get to know the Superstorm Sandy victims who were staying at the shelters after losing their homes, and after gaining their trust he would tell them he had apartments/condos/houses available to rent/buy. He would offer the properties for a very low rate, and the victims believed he was helping them out because of their relationship and the circumstances. He would also offer the victims low-cost cars, which he said he was able to sell for a low price because he had purchased them at police auctions.

Not only did David Scott Ruddy scam Sandy victims, but he targeted other vulnerable people as well. His victims include seven people who were displaced due to Sandy, and needed either a vehicle or housing, five who needed housing or a vehicle due to other reasons, and one victim who needed furniture, which Ruddy promised but failed to deliver. The recovery shelters after Sandy were the locations at which he met six of his victims, then met three of them through the people he met at the shelters, and the last four met him in various other places.

Hoffman called David Scott Ruddy’s actions “utterly despicable,” continuing that, “He gained the trust of his victims by posing as a rescue worker, only to steal their money and leave them in an even more desperate state.” Hoffman hopes that Ruddy’s conviction is a message to all other predators of the consequences of exploiting disaster victims.

The Sandy fraud task force was established by the Division of Criminal Justice to combat the number of people who have emerged attempting to defraud disaster victims. “When disasters strike, the best rush in to help,” explained Elie Honig, the director of the Division of Criminal Justice, “Unfortunately, the worst rush in too—to help themselves.”

The victims whom David Scott Ruddy met at the shelters stayed in touch with him after they left the shelters, and it was at that point that Ruddy extended his fraudulent offers to them. He operated his scam from a second-floor office building above a law firm on Rahway Avenue in Woodbridge, which he rented as a location to bring his victims to fill out the paperwork necessary to steal their money.

David Scott Ruddy operated under two aliases, David Castro and David Gartman, while he was scamming victims. He was arrested on January 26th, 2013, and has been held in the Middlesex County Jail ever since. Upon his arrest, it was discovered that he was connected to fugitive warrants issued regarding criminal charges against him in Georgia.

In addition to his guilty plea on October 8th for third-degree theft by deception, Ruddy was also prosecuted for defrauding four victims prior to his Sandy scheme. He stole a car lent to him by one man, another man loaned him $25,000 that he never repaid, and two others paid him $6,800 total to bail their children out of jail when he posed as a bail bond agent. Those charges landed him a five year sentence also, which he will serve concurrent with the five years for the Sandy victims scam.



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