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Construction company to pay $1.85 million to settle federal lawsuit

EAST GRAND FORKS - An East Grand Forks construction company will pay $1.85 million to settle a lawsuit alleging it violated laws regarding federal minority-owned contracts.

EAST GRAND FORKS - An East Grand Forks construction company will pay $1.85 million to settle a lawsuit alleging it violated laws regarding federal minority-owned contracts.

The U.S. Attorney’s Office in Minnesota announced the settlement with R.J. Zavoral and Sons on Tuesday.

According to allegations, Zavoral’s principals made false statements to the federal Small Business Administration and the Army Corps of Engineers to receive a contract for a 2004-2008 flood control project under an SBA program meant to benefit minority-owned and disadvantaged contractors.

Zavoral entered a joint venture with Ed’s Construction of Cass Lake, Minn., to qualify for the SBA program but took over the project after it had received the $19.1 million contract, according to a lawsuit filed by by the U.S. Attorney in 2012.

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