HAMMOND — A Lake County contractor who pleaded guilty earlier this year to federal counterfeit charges for cutting bogus checks to the Gary Housing Authority was able to dodge prison time at his sentencing on Tuesday.
U.S. District Court Judge Philip Simon ordered Ashley D. Dunlap, 54, of East Chicago, to serve two years probation — including six months of home detention — for counterfeiting securities of a private entity. Prosecutors had sought a prison term of 12 to 18 months.
Dunlap previously admitted to counterfeiting two checks totaling $69,600 to pretend his Gary-based D&R Construction Co. had the financial resources to complete two GHA residential improvement projects at Delaney and Dorie Miller public housing complexes he bid on five years ago.
The Gary Housing Authority solicited construction bids on July 15, 2013, and Dunlap won with a bid of $347,950. The government requires successful bidders to either post a surety or a cash equivalent of 20 percent of the bid to ensure the work gets done on time.
Because Dunlap didn't have the financial assets to make that commitment, he gave the housing authority two counterfeit cashier's checks that appeared to issue from Chase Bank to satisfy the surety requirement.
“I don’t like at all what I’m seeing here," Simon said. "Who gives the Gary Housing Authority such blatantly bogus checks? Somehow you got the contract. This is not the way public contracts should be meted out."
Assistant U.S. Attorney Maria Lerner had argued for prison time, saying even after winning the bid using illegal and deceptive tactics, Dunlap did not properly pay his workers prevailing wage — an issue later resolved.
At issue at Tuesday’s sentencing was how courts should calculate the fiscal loss in this case as a result of Dunlap’s defrauding of the local housing authority. Simon asked the question: Should it be $69,600 — the value of the counterfeit checks, or $347,950 — the total contract value Dunlap landed as a result of the bogus checks he issued to the local housing authority?
Assistant U.S. Attorney Maria Lerner argued the loss should be the total contract amount — $347,950, noting the court should consider his motive in the case was to secure a contract that would benefit his company, D&R Construction.
Simon ultimately sided with Dunlap’s attorney, Kevin Milner, saying the actual loss would have been nothing.
Lerner noted Simon should consider Dunlap’s criminal history. The contractor managed to get a 2006 voter fraud charge — tied to the E.C. mayoral race between Robert Pastrick and George Pabey — expunged from his record, she said. Simon agreed that while the expunged voter fraud charge is no longer part of his criminal record, he can consider it as a factor at sentencing.
As part of his sentencing, Simon ordered Dunlap to pay a fine of $7,500. During his home detention, he will be allowed only to drive to and from work, church, the doctor and locations approved by his probation office.
Wearing a red sweater and blue jeans, Dunlap sat quietly for much of the hearing. He spoke only when Simon asked if he understood the pre-sentencing investigative report prior to Tuesday's hearing.
“Good luck to you, sir,” Simon nodded to Dunlap at the close of the hearing.