Cop and Brother Plead Guilty to Defrauding Energy Efficiency Program
Former Stoneham, Mass., police officer Joseph Ponzo and his brother Christopher, a contractor, pleaded guilty to wire fraud and false statements in a bribery and kickback scheme targeting Mass Save contracts.
Joseph Ponzo worked for the Stoneham Police Department until 2022 when he was terminated after being arrested. Christopher Ponzo owned an electrical contracting company. Both men pleaded guilty to one count of conspiracy to commit wire fraud, 24 counts of wire fraud and one count of making false statements to government officials.
Joseph Ponzo also pleaded guilty to four counts of causing false tax returns to be filed with the IRS from 2016 to 2019.
What Are Mass Save Contracts?
Under Massachusetts law, utility companies collect an energy efficiency surcharge from all customers. The utility companies disburse funds from these charges to fund energy efficiency programs. They amount to hundreds of millions each year.
The programs subsidize or pay for homeowners to increase the energy efficiency of their homes, a win-win situation for consumers, who go on to see decreased gas and electric bills.
By taking money from the contracts and not doing the work, the Ponzo brothers robbed homeowners of that financial opportunity while indirectly contributing to atmospheric pollution.
$7 Million Dollar Fraud
Christopher Ponzo paid someone between $1,000 and $10,000 in cash weekly to help him and his brother become approved Mass Save contractors, according to an indictment obtained by The Daily Muck. Prosecutors say the person worked for a company responsible for vetting contractors approved for Mass Save contract work. That employee of the vetting agency ultimately helped Joseph Ponzo set up “Air Tight”– a shell company purportedly doing insulation work– to be approved as a Mass Save contractor and receive contracts under the program. Joseph Ponzo had no professional experience in insulation but still managed to get $7 million in Mass Save contracts.
The employee also aided another company, CAP Electric, also controlled by the Ponzo brothers, in getting Mass Save contracts.
In 2017, after the employee left the vetting company, another took his place in helping the Ponzo brothers operate their fraudulent scheme from 2018 to 2022. Though collecting under the Mass Save contracts, the Ponzo brothers did very little work they were contracted to do, say prosecutors.
False Tax Returns
During the course of the bribery kickback scheme, Joseph Ponzo filed false tax returns from 2016 to 2019 by claiming hundreds of thousands of dollars in fraudulent business deductions, say prosecutors.
Joseph Ponzo used a company credit card to purchase gift cards at The Home Depot, Lowes and Staples, which he and his wife subsequently used for personal expenditures. He represented these gift card purchases as legitimate business deductions, say prosecutors, in an attempt to decrease his taxable income.
Reactions by Officials
Illegal actions by cops like Joseph Ponzo discredit the uniform and the oath to protect and serve.
Stoneham Police Chief James O’Connor did not mince words when speaking about his former subordinate.
“The actions of this individual are not reflective of our mission or values,” O’Connor said in a statement. “It is our duty as police officers to follow and uphold the law, and these actions do not mirror our commitment to those values.”
“As officers of the law, we hold ourselves to the highest standards of integrity and professionalism,” O’Connor continued. “Our responsibility as officers is to protect and serve. This criminal behavior runs contrary to our duty to our community and erodes the trust from those we are meant to safeguard.”
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