Contractors Indicted in San Francisco Fraud Case

A federal grand jury issued the first criminal charges in an FBI investigation of San Francisco’s minority contracting program Thursday, accusing a minority-owned contractor of acting as a front for whites.

The indictments charged fraud against the black owner of Scott-Norman Mechanical, which has been awarded more than $55 million in city airport contracts, and the white executives of Scott Co. of California, which allegedly controlled Scott-Norman. The companies were also indicted.

City Atty. Louise Renne filed a civil fraud suit against Scott-Norman in September, making similar allegations. The suit has been transferred to Santa Clara County and is still pending.

Also indicted was Zula Jones, second-highest official in the city’s Human Rights Commission. She was accused of approving Scott-Norman as a minority-owned company, eligible for bid preferences in certain city contracts, while knowing it was ineligible.

There were no allegations of wrongdoing by Mayor Willie Brown.

Brown spokeswoman Kandace Bender declined to comment on the indictments.

“We need to let the legal process take its appropriate course of action,” she said.

Jones’ lawyer, Carleton Briggs, declined to comment. Jerrold Ladar, lawyer for Joseph Guglielmo, the president and chief executive of Scott Co., said Guglielmo had committed no fraud and would be exonerated.

Robert Carey, lawyer for Alvin P. Norman Jr., president of Scott-Norman Mechanical, did not return a call seeking comment.

Norman, 54, of San Francisco, has at least three criminal convictions, and spent four years in prison for killing his brother-in-law in 1968.

The FBI has been investigating city contracting programs for more than a year. Federal agents sealed the offices of the Human Rights Commission one weekend last July to look for records.