Five individuals have been indicted for wire fraud and money laundering in a scheme that misappropriated millions of dollars intended for maintenance work at New York City’s homeless shelters. The defendants allegedly manipulated public contracts for their benefit at the expense of taxpayers and vulnerable residents.
The accused include Liaquat Cheema and Ali Cheema, the president and vice-president of AFL Construction Co. Inc. (AFL), respectively. The Cheemas obtained contracts from New York City to provide maintenance services at homeless shelters, covering tasks such as landscaping, roofing, snow removal, and general upkeep.
However, instead of fulfilling these contracts, U.S. Attorney Damian Williams asserts that the defendants devised fraudulent schemes to embezzle funds. The remaining three individuals involved—Irfan Bajwa, Shouket Chudhary, and Khizar Hayat—are accused of laundering the stolen money through personal and business bank accounts to conceal the funds’ illicit origin.
The New York City Department of Investigation’s Commissioner, Jocelyn Strauber, detailed the methods used by the defendants to deceive the city. These included overbilling for building materials and submitting fake claims for workers who didn’t exist, enabling them to pocket the stolen funds.
Additionally, the defendants allegedly underreported their earnings in order to qualify for Medicaid benefits they were not eligible to receive. To substantiate these fraudulent Medicaid claims, they submitted false employment verification letters using the name of a deceased project manager.
Each defendant faces up to 30 to 50 years in prison for wire fraud, money laundering, and identity theft. This crime highlights the severe abuse of funds intended to support over 50,000 homeless individuals in New York City, including more than 16,000 children, who rely on shelter services every night.