Exec gets two years for cheating military
A federal judge sentenced a Michigan businessman to two years in prison yesterday for selling $3.9 million in bad parts to the military.
Shane M.S. Sarnac, 49, apologized to U.S. District Judge George C. Smith and said he and his company, Roth Fabricating, have been working hard to make amends for their mistakes.
Sarnac is president of Roth, a tubing and machine-tool manufacturing company his stepfather started 30 years ago in the small town of Morenci, Mich. In 2007 and 2008, the company began providing gun racks, seat assemblies and other products to the military.
Although Sarnac certified that the products were manufactured to military specifications, Defense Department engineers found that some were not and some represented a safety risk.
Sarnac pleaded guilty a year ago to one count of conspiracy to commit wire fraud, a charge brought because military payments were wired to Roth. His sister, Simone L. Haas, who also worked for the company, pleaded guilty to the same charge and is serving a 15-month prison sentence.
Smith ordered Sarnac, Haas and Roth Fabricating to pay restitution of $825,000 and ordered Roth to pay a $25,000 fine.
The defendants already have paid $400,000 of the ordered restitution and have agreed to pay the rest within 60 months, according to court records.
George B. Donnini, a Detroit attorney representing Roth, said the company has shrunk from 40 employees to 10 but hopes to remain in business. As part of a plea agreement, Smith is allowing Sarnac to report to prison a year from now, after his sister is released, so a family member is available to run the company.
“We’re glad we resolved this in a fashion to be able to keep the company open and provide restitution,” Assistant U.S. Attorney J. Michael Marous said.