Pearland contractor faces sentencing in $1.6 million VA hospital scheme

August 23, 2018

A Pearland contractor is set to be sentenced Thursday in Houston federal court after admitting he had a disabled veteran pose as his business partner in order to land a dozen lucrative veterans department contracts over a six-year period.

Henry Guillory, 55, pleaded guilty on May 1 to conspiracy to commit wire fraud involving money transfers between 2012 and 2018. He admitted that he and his “partner” defrauded the U.S. Department of Veterans Affairs of $1.6 million in the scheme.

Guillory is scheduled to be sentenced before U.S. District Judge Alfred H. Bennett, when he will face punishment of up to five years in federal prison and a fine of up to $250,000.

His lawyers did not respond to a request for comment.

Guillory’s sentencing was continued from July because he wanted to contest the government’s claim that five of the 12 contracts should be included in calculating the loss to the government. His lawyers argued that those five contracts were properly awarded to Guillory, who is African American, because he is a minority business owner.

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According to court documents, Guillory falsely claimed that a service-disabled veteran was the majority owner of his business. Guillory had his friend Derrick Andre Chizer sign up as his fellow contractor. Chizer is disabled and a legitimate Navy veteran.

The pair then landed 12 set-aside contracts for maintenance and construction work at the DeBakey VA Medical Center. Guillory made $450,000 in the scheme. He gave Chizer $38,000.

Chizer, 56, of Pearland, also took a guilty plea for conspiracy to commit wire fraud and was sentenced in July to two years’ federal probation.

The contracting program was set up to benefit businesses owned by injured veterans. In their pleas, the men admitted they deprived legitimate businesses of being awarded those funds. These contracts are intended for veteran-owned small businesses, and federal agencies can receive credit for hiring these businesses.

According to their pleas, the six-year scam began on on Nov. 21, 2012, when Guillory and Chizer registered a business, MEP Sales and Service, in Harris County. The following April, they filled out a form claiming that Chizer was a service-disabled veteran with majority ownership of the company.

Chizer is disabled and was honorably discharged as a petty officer after serving in the U.S. Navy from 1986 to 1989. But Guillory had majority ownership of the company, even though he claimed on official forms to be a minority owner.

The paperwork enabled the business to qualify as a Service Disabled Veteran Owned Small Business, making it eligible for special funds set apart for businesses run by disabled veteranss. Veteran’s Affairs awarded the company 12 small business set-aside contracts with a value of more than $1.6 million.