NEW YORK (Reuters) - A construction company owner, charged with defrauding a government program while his firm did nearly $1 billion in work at the World Trade Center, appeared in court on Thursday for the second time this week to plead guilty, only to change his mind.
Larry Davis, 63, chief executive of DCM Erectors Inc, had told the judge that he would plead guilty to wire fraud and conspiracy charges in connection with work the company performed for the Port Authority of New York and New Jersey.
But after telling the judge he did not know what he did was wrong, the proceedings were paused so Davis could talk to his lawyer, who subsequently apologized to the court and prosecutors and said his client would not be pleading guilty after all.
"As we all know, this is something that happens from time to time," said Sanford Talkin, Davis's lawyer.
Davis was accused of getting subcontractors to falsify papers to make it appear that he had hired businesses owned by minorities or women to comply with Port Authority regulations to expand diversity.
Prosecutors said Davis, a Canadian citizen, paid the owners of two such businesses millions of dollars to help him falsify documents.
The owners of the two subcontractors, Johnny Garcia and Gale D'Aloia, had already pleaded guilty and agreed to cooperate with authorities.
On Tuesday, Davis appeared for an expected plea hearing but left before any hearing could begin, without explanation. A new hearing was scheduled for Thursday, and Davis this time told U.S. Magistrate Judge James Francis that he would plead guilty to charges of defrauding the program.
But asked by the judge whether he knew what he did was wrong, Davis said no.
"The minority firms performed the work," he said.
The Port Authority, which is overseeing the redevelopment of the World Trade Center following the Sept. 11, 2001, attacks that destroyed the site's twin towers, awarded DCM a $256 million contract in 2007 to erect steel for 1 World Trade Center, the country's tallest skyscraper.
Two years later, the agency gave DCM a $330 million contract for work at the World Trade Center's new transit hub.
The value of the contracts has risen to nearly $1 billion, according to the office of Manhattan U.S. Attorney Preet Bharara.
(Reporting by Nate Raymond and Joseph Ax; Editing by David Gregorio)
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