Man pleads guilty to violating Minority Business Enterprise requirements to get tax cut

Published: Jan. 25, 2023 at 12:57 PM CST
Email This Link
Share on Pinterest
Share on LinkedIn

ST. LOUIS (KMOV) -- The former owner of a Clayton construction company pleaded guilty this week to two counts of wire fraud for violating St. Louis’ Minority Business Enterprise participation requirements to qualify for a tax abatement.

Court documents allege Brian Kowert Sr., along with minority business owner Charles Kirkwood, agreed to falsely list Kirkwood’s company as providing materials for a project Kowert was working on in St. Louis. The falsification would allow for the perceived 25 percent participation of a Minority Business Enterprise, which would qualify for a 10-year tax abatement.

Kowert was co-owner and COO of HBD Construction Inc. Kirkwood is the owner of Midwestern Construction. The project involved in the charges against Kowert was the renovation and redevelopment of a building for Greater Goods LLC on Chouteau Avenue, the U.S. Attorney’s Office said.

Prosecutors allege Kowert concealed his violations by issuing two subcontracts to Kirkwood’s company for work and materials that were fulfilled by two other companies that are not Minority Business Enterprises. Kowert also issued a purchase order to Kirkwood’s company for materials provided by a third company, also not a minority business.

Prosecutors allege Kowert paid Kirkwood about $2,000 for helping him in the fraudulent act. Kowert’s company issued 14 checks worth a total of $220,000 to Kirkwood’s company for the work allegedly done by three other companies.

Kowert’s sentencing is scheduled for April 26. Both wire fraud charges carry a penalty of up to 20 years in prison and a possible fine of up to $250,000.