Harrisburg, Pa. - A Connecticut man who was owner and president of a highway construction firm has pleaded guilty in a scheme to defraud the Pennsylvania Department of Transportation, according to federal officials.

Romeo P. Cruz, 59, admitted to filing a false income tax return for 2005 which substantially under-reported the income he received from his business, Marikina Construction Corporation. Cruz reported less than $6,000 in income, but admitted he disguised numerous payments made to himself and his family as legitimate business expenses, Acting US Attorney Martin C. Carlson said.

Cruz pleaded guilty in August 2008 to conspiracy to defraud PennDOT, the US Department of Transportation, and various general contractors.

Carlson said Marikina was designated a Disadvantaged Business Enterprise by PennDOT in 1993 and grew to be the largest recipient of DBE-designated funds. Between 1994 and 2007, Marikina received more than $121 million in subcontracts under the DBE program.

Cruz has admitted Marikina was a front company for Schuylkill Products, Inc. and CDS Engineers, Inc. of Cressona, Pa., which performed all of the work under the subcontracts and paid Marikina a small fixed fee, Carlson said. SPI and CDS were not disadvantaged businesses but used Marikina's name to obtain lucrative government contracts, according to Carlson.

Dennis Campbell, a vice president of SPI, and Timothy Hubler, a vice president of CDS, have pleaded guilty to fraud charges and are awaiting sentencing.

Cruz faces up to eight years in prison fines of up to $500,000.

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