A Glendale Community College track coach and a former track star at the school have pleaded guilty in federal court to charges of using a bid-rigging scheme to defraud Home Savings of America of more than $465,000.
Daniel P. Lodolo, 31, of Pasadena, and Thomas L. McMurray, 48, of Los Angeles, each face maximum sentences of 20 years in prison and fines of $1 million. Sentencing is scheduled Nov. 4 in U.S. District Court in Los Angeles.
Federal prosecutors said Lodolo, an assistant vice president at the savings and loan, used his position to win approval of inflated contracting bids submitted by McMurray, and the two then spent much of the money to build a house in a fashionable section of Pasadena.
McMurray, the men's track coach at the Glendale school for the last 11 years, is also the owner of T & M Graphics and Display, the contractor in the scheme, said Assistant U.S. Atty. Jeffrey Isaacs. Lodolo, a member of the team in 1979 and 1980, is a former 800-meter champion for the Western State Conference.
The FBI began investigating the pair 1 1/2 years ago after a contractor employed by McMurray became suspicious of the defendant's billing procedures, Isaacs said last Thursday.
According to Isaacs, Lodolo used his position at the savings institution to shunt at least 20 building contracts to T & M Graphics and Display and to McMurray.
Lodolo gave confidential bids to McMurray, who then submitted his own bids for the same projects as much as 200% higher than those of lower bidders, Isaacs said. To ensure that McMurray's bids won, Lodolo told his employers either that T & M was the only bidder or that it was the lowest bid, Isaacs said.
Then Lodolo authorized legitimate contractors to do the work for substantially less than T & M was paid. In one case, McMurray was paid $73,276 for a job that another contractor performed for $15,914. McMurray paid the legitimate contractor out of Home Savings funds, and he and Lodolo split the difference, Isaacs said.
"It was a very clever scheme," Isaacs said. "If they had not engaged in so many transactions, there's a good chance they could have gone on undetected."
The pair did not live noticeably extravagant lives, Isaacs said. Instead, they invested most of the money in the construction of a hillside residence on Wierfield Drive in the well-to-do Annandale section of Pasadena.
Before the two were caught, the house, which was Lodolo's residence, had been placed on the market for $680,000.
Lodolo has pleaded guilty to two counts of bank fraud and two counts of accepting bribes. McMurray has pleaded guilty to two counts of bank fraud and two counts of aiding and abetting the misapplication of bank funds.
The defendants, who remain free on $10,000 bail, have agreed to turn the Annandale residence over to Home Savings and to pay $75,000 in cash as restitution for their crimes.