The Connecticut city of West Haven said it is being reimbursed more than $1 million from its insurer to cover the cost of federal pandemic relief funds stolen three years ago by two city employees.
Then-state Rep. Michael DiMassa and John Bernardo were involved in a scheme that defrauded the city and taxpayers of $1.2 million.
Mayor Dorinda Borer pursued recovery of the stolen Covid-19 money for taxpayers and was recently notified of a $1.2 million settlement with the city’s carrier, The Hartford Financial Services Group.
According to the Hartford’s fidelity crime claims division, after applying $79,177.98 the city has received in court-ordered restitution and the $100,000 deductible, the net loss to be covered by insurance is $1,037,363.82.
“This is a huge victory,” Borer said.
DiMassa, 32, of West Haven was arrested on October 20, 2021. On November 1, 2022, he pleaded guilty to three counts of conspiracy to commit wire fraud. In May 2023, he was sentenced to 27 months of imprisonment, followed five years of supervised release, for his involvement in the schemes that resulted in the theft of more than $1.2 million dollars in funds from the city. He was also ordered to perform 100 hours of community service. DiMassa was ordered to pay $856,844.45 in restitution.
On June 14, 2022, Bernardo pleaded guilty to one count of conspiracy to commit wire fraud. On March 22, 2023, he was sentenced to 13 months of imprisonment and ordered to pay $58,927.25 in restitution.
According to court documents, DiMassa was a Connecticut state representative who was also employed as the administrative assistant to the West Haven City Council. In April 2020, the state was allocated money under the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) to help local governments pay costs incurred in responding to the Covid-19 pandemic. From July 2020 through September 2021, West Haven received approximately $1,150,257 from this fund. DiMassa, who was authorized to approve the designated relief funds for reimbursement, conspired with others to steal these funds and other funds through the submission of fraudulent invoices, and subsequent payment, for Covid relief goods and services that were never provided.
In one scheme, DiMassa conspired with John Bernardo, who was employed by the city’s office of Community Development Administration. In January 2021, DiMassa and Bernardo formed Compass Investment Group, LLC, which fraudulently billed the city for consulting services purportedly provided to the West Haven Health Department that were not performed. From February 2021 through September 2021, the city paid Compass a total of $636,783.70. DiMassa made several large cash withdrawals from the Compass bank account, some of which were made shortly before or after he made a large cash “buy-in” of gaming chips at the Mohegan Sun Casino.
According to court documents, DiMassa also conspired with his now wife, Lauren DiMassa, through the submission of fraudulent invoices for services related to a youth violence prevention program. West Haven paid approximately $147,776.10 to Lauren DiMassa, who never provided any services to the city.
On July 14, 2022, Lauren DiMassa pleaded guilty to one count of conspiracy to commit wire fraud. On March 23, 2023, she was sentenced to six months of imprisonment and ordered to pay $147,776 in restitution.
In a third scheme, DiMassa conspired with John Trasacco, of West Haven, using fraudulent invoices from L&H Company and JIL Sanitation Services, two companies controlled by Trasacco, for goods and services, including personal protective equipment, HVAC maintenance, and cleaning services for various municipal and school buildings, including one school that had been vacant for several years. Trasacco’s companies received approximately $431,982 through this scheme.
On December 2, 2022, a jury found Trasacco guilty of one count of conspiracy to commit wire fraud and one count of wire fraud. On April 3, 2023, he was sentenced to 96 months of imprisonment and ordered to pay $143,994 in restitution.
This matter was investigated by the Federal Bureau of Investigation and the U.S. Department of Housing and Urban Development. The case was prosecuted by attorneys in the office of Vanessa Roberts Avery, US Attorney for the district of Connecticut.
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