HARRISBURG — Thomas E. Lauer and Rebecca J. Davis pleaded guilty to one count of conspiracy to commit major fraud against the United States in September 2026. The defendants admitted to a scheme involving over $80 million in federal contracts awarded to Davis’s company, Elstner Construction Company, at Letterkenny Army Depot.

From 2007 to 2014, Lauer and Davis conspired with each other and others to obtain five contracts awarded to Elstner Construction Company at the military installation. The collective value of the five contracts exceeded $80 million. These contracts were set aside for eligible small, disadvantaged businesses participating in the U.S. Small Business Administration’s 8(a) Business Development Program, which is designed to assist socially and economically disadvantaged entrepreneurs in gaining access to federal contracts.

Lauer and Davis admitted to entering the contracts knowing the company would violate certain program rules. The contracts imposed requirements relating to performance by the prime contractor, Elstner Construction Company. Davis was required by the SBA’s 8(a) Business Development Program to perform at least 15% of any contract with its own employees, but she and Lauer violated this requirement in the Letterkenny Army Depot contracts. Lauer and Davis admitted to knowingly violating contract provisions regarding prime contractor performance.

Davis joined the 8(a) program in or around 2001 through Elstner Construction Company. She was not eligible for the program because she had previously entered it under a different company name, violating the rule on one-time eligibility. Davis admitted that her entry into the program violated this rule.

In January 2008, Davis submitted a false certification stating she and her company were in compliance with 8(a) Business Development Program rules relating to control and one-time eligibility. Davis also admitted to making false and fraudulent submissions to the U.S. Small Business Administration during the criminal conduct. Davis was formerly known as Rebecca J. Numer and Rebecca J. Elstner.

In addition to the Letterkenny contracts, Lauer admitted to conspiring with others to obtain a $5.3 million contract awarded to Bon Secour Management at the VA Medical Center in Salem, Virginia. This contract was awarded through a small business program for businesses owned and controlled by service-disabled veterans. Lauer assisted others in obtaining certification for Bon Secour Management as a service-disabled veteran-owned small business in or around 2011. In March 2013, Bon Secour Management was awarded the Salem VAMC contract based on a false representation that at least 15 percent of the contract performance cost would be spent on its employees.

The case was investigated by the U.S. Department of Defense Office of Inspector General, Department of the Army Criminal Investigation Division, U.S. Department of Veterans Affairs Office of Inspector General, and the U.S. Small Business Administration Office of Inspector General. Assistant U.S. Attorneys Ravi Romel Sharma, Christian T. Haugsby, and K. Wesley Mishoe are prosecuting the case.

Why It Matters

The indictment against Thomas E. Lauer and Rebecca J. Davis included forfeiture allegations of $85 million, the same amount the defendants allegedly fraudulently obtained through construction projects at Letterkenny Army Depot. Elstner Construction Company received five 8(a) Program contracts from Letterkenny Army Depot between 2007 and 2014, with a total value exceeding $80 million. Elstner Construction Company was admitted to the SBA's 8(a) Business Development Program in 2001, despite Davis having previously entered the program under a different company name, violating the 'one-time eligibility' rule.

The U.S. Small Business Administration Office of Inspector General investigated the fraud case involving Elstner Construction Company and Bon Secour Management, along with other federal agencies including the Department of Defense and the Department of Veterans Affairs. In 2011, Thomas E. Lauer assisted others in obtaining certification for Bon Secour Management as a service-disabled veteran-owned small business (SDVOSB), which was later used to fraudulently secure a $5.3 million contract at the Salem VA Medical Center.

Timeline

On January 1, 2008, Davis submitted a false 2008 certification stating she and her company were in compliance with 8(a) Business Development Program rules relating to control and one-time eligibility. In September 2026, Davis agreed to pay $6 million in restitution, representing the approximate revenue Elstner Construction Company retained from the Letterkenny Army Depot contracts.

Also in September 2026, Thomas E. Lauer and Rebecca J. Davis pleaded guilty to one count of conspiracy to commit major fraud against the United States. On that same date, Lauer agreed to pay $6 million for the loss associated with the Letterkenny Army Depot contracts. Additionally in September 2026, Lauer agreed to pay approximately $459,000 in proceeds maintained by Bon Secour Management from the Salem VA Medical Center contract. Finally, in September 2026, Lauer agreed to pay about $6.45 million in restitution.

What's New

Later reporting indicates the indictment against Thomas E. Lauer and Rebecca J. Davis included forfeiture allegations of $85 million, the same amount the defendants allegedly fraudulently obtained through construction projects at Letterkenny Army Depot. Additional details show that Rebecca J. Davis, through Elstner Construction Company, was required by the SBA’s 8(a) Business Development Program to perform at least 15% of any contract with its own employees, but she and Lauer allegedly violated this requirement in the Letterkenny Army Depot contracts. The indictment against Lauer and Davis included forfeiture allegations seeking $85 million—the amount the defendants allegedly fraudulently obtained in construction projects at Letterkenny Army Depot.

Further reporting reveals that Elstner Construction Company was admitted to the SBA's 8(a) Business Development Program in 2001, despite Rebecca J. Davis having previously entered the program under a different company name, violating the 'one-time eligibility' rule. Elstner Construction Company, Inc. (ECC) was enrolled in the SBA's 8(a) Business Development Program in or around 2001, but Davis had previously entered the program under a different company name, violating the 'one-time eligibility' rule.

How Sources Differ

The United States Attorney’s Office for the Middle District of Pennsylvania press release states that Thomas E. Lauer and Rebecca J. Davis pleaded guilty to one count of conspiracy to commit major fraud against the United States.

Regarding the Letterkenny Army Depot contracts, dodig.mil states that Rebecca J. Davis, through Elstner Construction Company, was required by the SBA’s 8(a) Business Development Program to perform at least 15% of any contract with its own employees, but she and Lauer allegedly violated this requirement in the contracts. The United States Attorney’s Office for the Middle District of Pennsylvania press release states that Davis agreed to pay $6 million in restitution, representing the approximate revenue Elstner Construction Company retained from the Letterkenny Army Depot contracts.