SOUDERTON — Engineering firm Boucher & James has restructured and made changes to its accounting systems to make sure that the fraud orchestrated by three of its former executives will not happen again, the man who discovered the fraud and is now CEO, told Souderton Borough Council at its Jan. 18 work session meeting.
"No one saw what was going on, including myself. I came upon it accidentally," Jon Tresslar said.
Tresslar, who at the time was one of four managing directors at the company, said he found the fraud while reviewing some invoices in 2017 and noticing charges had been added to the bill.
"I reviewed the invoice and it didn't make any sense to me because I know what it should have taken to do that job and the invoice reflected something other than that, so I dug deeper and that's when I found a problem," Tresslar said, "and so then when I started digging deeper after finding that problem, I just continued to find problems."
He first reported what he found to the other three managing directors, then to the board of directors, then to law enforcement, he said.
In December of 2020, Pennsylvania Attorney General Josh Shapiro announced the arrest of Ross Boucher, of Venice, Fla., Boucher & James former owner and board member, and former managing directors Mark Eisold, of Hartsville, and David Jones, of Pennlyn, after the three allegedly defrauded clients of $2.1 million between 2009 and 2018. Souderton was one of several local municipalities among the clients.
"What was happening was that hours were being added to your invoices on time and material jobs that were not actually being worked by the employee," Tresslar said.
The board of directors has been replaced and the people involved in adding charges to the bills are no longer with the firm, he said. The previous company structure of the employee-owned firm has also been changed. It previously had four managing directors with equal authority, but now has one person, the CEO, in charge, he said. Changes have also been made to the accounting procedures, including for recording the time spent on client jobs, he said.
"Before those procedures were put in place, someone could add some hours to a bill and they really weren't questioned by the accounting department because they didn't know any different. They thought they were being added legitimately and there was no one to go to if they didn't," Tresslar said.
He said he now reviews all the bills.
"You now have a hierarchy and the guy at the top is the person who's responsible. We didn't have that before. That's probably the biggest change that is going to protect the integrity of all the corporate transactions," he said.
The Boucher & James firm agreed to pay $851,000 of restitution and has not been charged with anything, Tresslar said.
That money is being distributed by the Attorney General's office, which has forwarded $11,000 to Souderton, Borough Manager Mike Coll said.
He said he doesn't know if that covers the amount the borough was overbilled, but thinks it is a fair settlement.
"We did not do our own audit and I don't think it's worth spending the money to do that," Coll said.
Tresslar had been overseeing the Souderton billing since 2015, so any overbilling would have been before that, Coll said.
Boucher & James has also changed its procedures to give a written proposal with an estimate of the costs for larger projects, then include on invoices how much of the estimated cost has been billed and how much remains, Coll said.
Boucher & James was previously appointed as Souderton's engineer through the end of this year, he said.
"I will guarantee that there's not gonna be any wrong billing on your bills and we as a company want to continue serving you as a client," Tresslar said.
He said the company has done work for Souderton for a number of years.
Council President Brian Goshow questioned why the overbilling wasn't detected sooner, but also said the total costs for the work done seemed to be a good price.
"I believe the reason that we missed it is because regardless of what was being billed or wasn't being billed, the amount of work that was done for the money did not seem off by very much or seemed to be fair," Goshow said.