FACTS about Public Roofing Procurement, and Oversight. Copyright 2010 by Robert R. Solomon

Thursday, March 30, 2017

Tremco, the "Darlings" of Purchasing Cooperatives. .

Any school administrator should know this before it's too late. The schools, and other public works that Tremco defrauded got NOTHING!

https://www.sec.gov/litigation/litreleases/2016/lr23639.htm  


U.S. SECURITIES AND EXCHANGE COMMISSION

Litigation Release No. 23639 / September 9, 2016

Securities and Exchange Commission v. RPM International Inc., et al., Case No. 16-cv-01803 (D.D.C. filed Sept. 9, 2016)

SEC Charges RPM International Inc. and its General Counsel for Disclosure and Accounting Failures

The Securities and Exchange Commission today charged Ohio-based chemical company RPM International Inc. and its General Counsel, Edward W. Moore, with failing to disclose a material loss contingency, or record an accrual for, a government investigation when required to do so under governing accounting principles and securities laws.

The SEC alleges that, from 2011 through 2013, RPM and one of its subsidiaries were under investigation by the U.S. Department of Justice (DOJ) for overcharging the government on certain contracts. 

Moore, RPM's General Counsel and Chief Compliance Officer, oversaw RPM's response to the DOJ investigation. According to the SEC's complaint, however, Moore did not inform RPM's CEO, CFO, Audit Committee, and independent auditors, of material facts about the investigation. 

For example, Moore knew but failed to inform them that: RPM sent DOJ estimates showing RPM's subsidiary overcharged the government on the contracts under investigation by a material amount; RPM agreed to submit a settlement offer by a specific date to resolve the DOJ investigation; and, prior to submitting the settlement offer to DOJ, RPM's overcharge estimates increased substantially to at least $28 million.

NOTE:  The DOJ already fined Tremco $61,000,000.00 for overbilling.  Again, the ones who were defrauded (primarily schools) got NOTHING.  

As a result of Moore's conduct, the SEC alleges that RPM filed multiple false and misleading documents with the SEC. For example, among other things, RPM failed to disclose in its filings with the SEC any loss contingency related to the DOJ investigation, or to record an accrual on its books, when required to do so by governing accounting principles and the securities laws. RPM also failed to disclose in its SEC filings a material weakness in its internal control over financial reporting and its disclosure controls when in fact such weakness existed. 

Consequently, RPM did not provide investors with accurate information about RPM's financial condition. In August 2014, RPM restated its financial results for three quarters that occurred during the DOJ investigation and filed amended SEC filings for those quarters, disclosing the DOJ investigation and related accruals. 

In the restated filings, RPM also disclosed errors relating to the timing of its disclosure and accrual for the DOJ investigation.

The SEC's complaint charges RPM with violating antifraud provisions of the federal securities laws, Sections 17(a)(2) and (a)(3) of the Securities Act of 1933; the reporting provisions of the federal securities laws, Section 13(a) of the Securities Exchange Act of 1934 and Rules 12b-20, 13a-1, 13a-11, and 13a-13 thereunder; and the books and records and internal controls provisions of the federal securities laws, Sections 13(b)(2)(A) and 13(b)(2)(B) of the Exchange Act. The complaint also charges Moore with violating Sections 17(a)(2) and (a)(3) of the Securities Act and Rules 13b2-1 and 13b2-2 under the Exchange Act. The complaint seeks permanent injunctions, disgorgement of ill-gotten gains plus interest, and penalties.
The SEC's investigation was conducted by Timothy K. Halloran and Michael J. Hoess. The SEC's litigation will be conducted by H. Michael Semler, Gregory R. Bockin, Mr. Halloran, and Mr. Hoess.
 SEC Complaint

http://www.sec.gov/litigation/litreleases/2016/lr23639.htm

Thursday, March 9, 2017

Another Angry Jurisdiction after Tremco's latest Overbilling Scam..

Friends:

Before the story, let me share basics to avoid such heartbreak.  If you can avoid three things, will have a much better chance of success with your project.

1.)  NEVER BUY A ROOF FROM A PURCHASING COOPERATIVE.  Purchasing Cooperatives are not competitiv in any way.

2.)  Buy Mainstream manufacturers like GAF, Firestone, Johns Manville, Carlisle.  They are also locally stocked by roofing material supply houses.  The supply house can also recommend quality roofing contractors.  The Supplier knows who pays their bills, and who doesn't.

3.)  Research before you buy.   Type "School Roofing Scam" into your browser, and do the same thing on YouTube.  You will find three players:  Purchasing Cooperative, Tremco, Garland.

It's your career, and your responsibility, so I hope this helps.

Now to the story (I have other examples like this):  

 http://www.mydaytondailynews.com/news/miami-county-left-out-roofing-company-payback-for-over-billing/wBxo5luYtlWL84jVwIySaN/

 Miami County left out of roofing company’s payback for over-billing


   

Posted: 10:23 a.m. Wednesday, March 01, 2017


"An Ohio-based roofing company that the I-Team reported in 2014 was likely over-billing governments across the state quietly reimbursed some, but not all, of the agencies it was suspected of over-billing.
Tremco, based in Beachwood, voluntarily repaid 11 state agencies a total of $214,308 last year after it was discovered the company was not giving taxpayers the same discounts they were giving private companies.
“The money was paid in 2016 following discussions with the vendor after the action with the federal government,” said Ohio Department of Administrative Services spokesman Marty Berkowitz. “Ohio was not included in any formal settlement agreement. Tremco voluntarily paid the amounts as listed.”
The I-Team reported in 2014 that state and local governments had paid Tremco $23.4 million under those state contracts from 2006 to 2014.
Contacted this year, state officials said they don’t know which local governments were reimbursed. Tremco officials were asked the same question and responded with a statement that did not name which governments they reimbursed.
Miami County officials, contacted this month by the I-Team, said they didn’t get any reimbursement from Tremco, though a local law enforcement investigation in 2012 called into question the company’s pricing and said county taxpayers overpaid hundreds of thousands of dollars.
In 2013, a federal lawsuit came to light, in which a former Tremco vice president alleged the company used misleading business practices in federal contracts. This included installing defective roofs, giving larger discounts to private customers than government customers and re-labeling generic material as high-end at a marked-up price.
Ohio officials based their blanket contract with Tremco, used by state and local governments, on those federal contracts.
Tremco officials said in their statement that they notified DAS “when Tremco discovered errors in its administration of these contracts.”
“The company also subsequently followed through on a process with the DAS to account for and correct those errors through reimbursements to affected state agencies and local entities that utilized the (state contract),” said a statement from the company.
Tremco settled the federal lawsuit for $61 million, with a large portion going to the whistleblower because the suit was filed under the False Claims Act. The False Claims Act is a law the federal government and several states have encouraging whistle-blowers in government contracting fraud by allowing damages three times the amount of damages and giving whistleblowers a share.
Ohio has no false claims act, though Ohio Attorney General Mike DeWine and Auditor Dave Yost have both called for them in the past.
A spokeswoman for DeWine’s office declined to comment on the Tremco issue because the Ohio Department of Administrative Services negotiated the reimbursements with Tremco.
“We get involved when our clients seek our assistance or representation, but in many cases, state agencies resolve matters on their own,” said AG’s office spokeswoman Kate Hanson in an email.
Tremco’s statement says their over-billing of entities in Ohio wasn’t intentional.
“The errors that led to some customers not receiving full discounts on purchases through the (state contract) was not due to a business practice, but rather to unintentional errors in the administration of Tremco’s federal … contracts, the terms of which also impacted purchases under the (state contract),” the statement says. "

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Avoid the grief, exposure, and pain by just saying "NO" to Purchasing Cooperatives, Tremco, and Garland.  You will be happier for it.  

Thank you for spending time with me here.  I know it gets boring, but I want to help you before the sharks circle with their "Predatory Sales Models".

I have over 105,000 views here, and I am thrilled that anyone cares.  

NOTE:  Retired 2003, do not solicit nor accept compensation or personal advancement of any kind.
Reject negativity in all forms, and always remember to keep looking "UP".

Respect.

Robert R. "Ron" Solomon
Director, Roof Consultant's Alliance
Public Procurement Analyst
State Certification CCC 1325620


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