Former president of Wilmington construction company pleads guilty to payroll scheme
NER Construction Management Corp. president engaged in a scheme to defraud union benefit funds, IRS
BOSTON — The former president of the Wilmington-based NER Construction Management Corp. pleaded guilty in federal court to a payroll scheme involving underreporting overtime hours for union employees and failing to collect and pay payroll taxes.
Acting U.S. Attorney Joshua Levy’s office said Frank Loconte, 62, of Beverly, defrauded union workers of more than $1 million of overtime work and the IRS of more than $3 million by not making the required payroll tax and union dues withholdings and payments.
Documents filed in federal court state Loconte used the funds for personal expenses, including vehicles, household improvements, golf club memberships, and personal property taxes for houses in Beverly, Ipswich and Andover, as well as Naples, Florida.
Loconte, who served as the president of NER from 2009 to 2022, pleaded guilty on Wednesday to mail fraud and failing to pay taxes, which are charges that carry a combined sentence of up to 25 years in prison.
Loconte is scheduled to be sentenced on Nov. 29.
Documents filed in federal court state Loconte was the 40% owner of NER and controlled its day-to-day operations during his roughly 13 years with the construction company.
He also served as the president of NER’s employment management company, NER Management LLC. Through NER, Loconte was responsible for collective bargaining with multiple unions, including the Bricklayers and Allied Craftsmen Local Union No. 3 and various local unions affiliated with the Massachusetts and Northern New England Laborers’ District Council of the Laborers International Union of North America.
According to Levy’s office, Loconte was bound by collective bargaining agreements with the unions which governed the transfer of worker benefit contributions to employee welfare and pension benefit plans, each of which was subject to Employee Retirement Income Security Act provisions.