Contractor in $20M Pierrefonds library upgrade engaged in 'fraudulent practice,' inspector general finds
Les Constructions Lavacon Inc. made extra cash off deals with subcontractors, report says
A construction company that won a $20.35 million contract to revamp a Pierrefonds library was involved in a scheme to make more money through its subcontractors, according to a new report by Montreal's inspector general.
Les Constructions Lavacon Inc. secured the winning bid in 2017 and completed construction in the fall of 2018.
The investigation found that the company made extra money off its subcontractors by having them charge five to 15 per cent less for their work.
That discount, however, was not passed on to the city, which ended up paying the full price.
"At no time were the city project managers aware of such an agreement, and it would have been impossible for them to know of its existence since subcontractors were under the responsibility of the general contractor," the report states.
The inspector general concluded that the company's actions amounted to "a fraudulent practice."
The report recommended the company be prohibited from city contracts for five years.
In a statement, Lavacon denied the details of the report and said it is seeking legal counsel to fight the allegations.