Contractor Awarded Southern Company Work Despite Fraud Allegations and a DOJ Settlement Agreement
Updated: Aug 16
By: Donald V. Watkins
Copyrighted and Published on August 14, 2023; Updated on August 16, 2023
SPECIAL INVESTIGATIVE REPORT ---
Yesterday, I introduced my readers to D&N Electric Company (DNE) and Miller Electrical Contractors, Inc., in an article that unveiled a trove of racist, anti-gay, and xenophobic emails that were circulated between Michael W. Munroe, a DNE/Miller Electrical Contractors, Inc., officer and executive, and his intimate circle of Atlanta-area corporate owners, co-workers, bankers, and friends in 2011 and 2012.
From 1993 to 2015, Michael Munroe was Chief Operating Officer and Corporate Secretary for DNE. From 2015 to 2023, Monroe was Vice President of Miller Electrical Contractors.
In his executive capacities, Michael Munroe served as a contracts administrator and compliance officer for DNE and Miller Electrical Contractors.
Despite Munroe’s documented racism, anti-gay behavior, and xenophobic banter at DNE, the Southern Company spent tens of millions of dollars to enrich the company's owners and executives.
The Southern Company chose to overlook Michael Munroe's flaming displays of bigotry towards blacks, gays, and Muslims. The Southern Company stood by Munroe at DNE and, later, at Miller Electrical Contractors.
Adding insult to injury, is this salient fact: At least 25% (or $15 billion) of the Southern Company's nearly $60 billion in annual revenues is derived from its black customers. In the ultimate act of disrespect, the Southern Company used millions of dollars from its black customers to enrich the white principals and executives of DNE and Miller Electrical Contractors while Michael Munroe was busy spewing and spreading the nastiest forms of racial hatred.
The flow of Southern Company money to DNE dried up after John F. Carter, an Atlanta-based black businessman, bought a 60% equity stake in DNE in 2013. After the acquisition, Carter discovered a trove of racist, anti-gay, and xenophobic emails on the company's computer servers.
The Southern Company contract money that was already flowing to Miller Electrical Contractors ramped up after white executives left the John Carter-owned DNE company and migrated to Miller Electrical Contractors.
DNE was white-owned prior to John Carter's purchase of a majority stake in the company in 2013. Miller Electrical Contractors is, and always has been, white-owned.
DNE also owned 49% of Miller Electrical Contractors. The other 51% was owned by McKendree “Ken” Miller, who was forced out of the company by former DNE shareholders Armstrong, Harper, and Charles S. Wallen in a 2017 hostile takeover.
Carter's acquisition of DNE did not include a change of ownership of Miller Electrical Contractors or his assumption of control over that company.
The U.S. Government Lodged False Claims Act Allegations of Contract Fraud Against DNE
In choosing to continue its business marriage with DNE (up until the change of DNE's ownership in 2013) and Miller Electrical Contractors (unabated since 2000), the Southern Company ignored U.S. Department of Justice (DOJ) allegations of False Claims Act contract fraud leveled against DNE at a time when Michael Munroe was overseeing DNE's contracts.
This fraud allegations are described in a Settlement Agreement that DNE executed in April 2013 with the DOJ and Christian Jon Shockley, a False Claims Act whistleblower.
On November 21, 2011, the DOJ and whistleblower Christian Jon Shockley alleged that DNE falsely certified that the construction materials the company used on U.S. Army posts at Fort Stewart and Fort Benning, Georgia, from October 1, 2009, to June 30, 2011, were compliant with the Buy American Act (41 U.S.C. §§ 8301–8303) when, in fact, they were not.
According to the DOJ and Shockley, DNE used construction materials and products that were manufactured in other countries. DNE allegedly caused fake “Made in the USA” labels to be placed on the materials and products in question.
DNE paid the DOJ and Mr. Shockley a total of $121,996.00 in fines and attorney’s fees to escape civil liability in the case. DNE did not admit to any wrongdoing in the Settlement Agreement.
Matthew G. Armstrong and Michael Munroe signed the Settlement Agreement on behalf of DNE. These are the same two men who reveled in the racist, anti-gay, and xenophobic emails that Munroe generated and circulated while working at DNE in 2011 and 2012.
Neither the DOJ's allegations of contract fraud against DNE, nor the Settlement Agreement, nor Munroe's cache of racist, anti-gay, or xenophobic emails, has been sufficient to disqualify DNE and/or Miller Electrical Contractors as an approved Southern Company vendor.
Birds of a Feather Flock Together
In 2022, the Southern Company executed the same kind of Settlement Agreement with the DOJ, but for much higher dollar amount.
On November 17, 2022, PowerSecure, a Southern Company affiliate, executed a Settlement Agreement with the DOJ in a False Claims Act contract fraud case involving a $1.3 million sole source contract awarded to PowerSecure by the U.S. Army Corps of Engineers.
Somehow, this $1.3 million sole source contract mushroomed to a whopping $523 million contract (via highly suspect post-award contract modifications) for the repair and restoration of Puerto Rico’s power grid following the damage caused by Hurricane Maria in September 2017.
PowerSecure beat the case by agreeing to pay the DOJ a mere $8.4 million in fines for the privilege of fleecing $523 million out of a $1.3 million U.S. government sole-source contract.
Like DNE, no PowerSecure executive has been prosecuted for fraud in connection with the government contract in question.
Like DNE's Settlement Agreement, PowerSecure's Agreement does not bar the Southern Company from serving as an approved contractor on future federal government agency jobs.
Finally, an approved Southern Company vendor willfully falsified certified test results at the company's new Vogtle Nuclear Power Plant Unit 3 during hot functional testing of the unit. This U.S. Nuclear Regulatory Commission violation became public last June.
Like DNE and its two military construction projects, the Southern Company allowed the contractor involved in this falsified records incident to continue working on the Vogtle 3 construction project.
Michael Munroe retired as a vice president from Miller Electrical Contractors in May 2023.
Matthew Armstrong, who was listed among the circle of former DNE executives receiving Michael Munroe’s racist, anti-gay, and xenophobic emails, serves as Miller Electrical Contractor’s president.
John Carter has disassociated himself from all of the shenanigans caused by the former executives of DNE and the current executives affiliated with Miller Electrical Contractors.
The Southern Company continues to embrace and enrich Miller Electrical Contractors as an approved vendor and valued team member.