Valpo businessman agrees to plead guilty in federal fraud case

2014-06-26T11:10:00Z 2014-06-26T23:45:23Z Valpo businessman agrees to plead guilty in federal fraud caseSarah Reese sarah.reese@nwi.com, (219) 933-3351 nwitimes.com

HAMMOND | A Valparaiso businessman was charged and agreed to plead guilty last week in an alleged scheme to defraud a Vermont company of more than $700,000.

Kevin J. Babich, who owned and operated Utility Communications Inc., admitted in a written plea agreement made public Wednesday that he accepted a $680,000 payment from Vermont Transco, also known as VELCO, in June 2009 for work on communications towers.

Babich represented that he would apply a partial payment toward work, but he instead used it to pay personal bills and other obligations that had nothing to do with the contract, court documents say.

VELCO became impatient because the promised work was not being done on schedule and wanted to hire a company not affiliated with Babich to install software he needed to complete his project, the plea agreement says.

Babich referred VELCO to a business named Digicom and concealed that he owned Digicom and had established it at an address in Portage, court records state.

Babich received a $24,000 payment from VELCO through Digicom, court records state.

An online search for Utility Communications shows it is associated with a Valparaiso address.

Because Babich quickly accepted responsibility for his alleged crimes, the U.S. attorney's office agreed to recommend he receive the minimum sentence under federal guidelines. Babich also may seek a sentence of probation. The maximum sentence for each count is 20 years in prison.

The plea agreement still must be approved by a judge.

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