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Lumber Sales Team That Defrauded Rutgers Now Behind Bars

Feds Prosecuted Co-Owner and President of Bayway Lumber, Along With His Salesman
Bayway Lumber
Bayway Lumber in Linden Google Maps

TRENTON, NJ—Two people involved in a Linden-based lumber company are now behind bars after admitted to defrauding and overcharging customers, including public entities, after showering some of those same customers with gifts.

Victims of the scheme include Amtrak, the Plainfield Board of Education, and several other government entities including RutgersUniversity.

Adam Martignetti, a 44-year-old South River resident who worked for Bayway Lumber, pled guilty to two charges in federal court last year: conspiracy to commit wire fraud and lying to a grand jury.

His  former boss, Robert Dattilo, now resides at a low-security prison in Loretto, Pennsylvania, where he is serving a four-year sentence after pleading guilty to conspiracy to commit mail fruad and conspiracy to commit wire fraud.

Meanwhile, Martignetti, resides in the Fairton medium-security correctional facility in Cumberland County where he is serving a one-year sentence.

The scam was perpertrated under the supervision of one of the company's owners, Robert Dattilo, who was sentenced to four years in federal prison and admitted to altering invoices to defraud the University of Medicine and Dentistry (UMDNJ), and both of its "successor institutions," Rutgers University and University Hospital.

In July 2013, UMDNJ officially merged with Rutgers University, and the Newark-based hospital was spun off into an independent entity.

One month later, Datillo directed an employee of Bayway lumber to send UMDNJ a fraudulent invoice, according to the indictment against him.

Datillo also admitted to defrauding the city governments of Newark and Elizabeth, the Philadelphia Housing Authority, the utility company Con Edison, the New York Department of Corrections, and the New York Transit Authority.

Both men pleaded guilty before U.S. District Judge Peter G. Sheridan.  Datillo was sentenced to four years in federal prison, while Martignetti's sentence was 12 months.

Datillo was also ordered to pay a total of $708,386 in restitution to the many victims of the scheme.

The scheme also involved "providing free items to the customers' employees and then recouping the  cost of the items – plus additional revenue for Bayway Lumber – by overbilling the customers," according to authorites.

Between 2011 and 2013, Martignetti reportedly gave away a laptop, several iPads, a camera and sound system, patio furniture, and other merchandise to those who worked for the entities he defrauded, only to supply their operations with "lower-quality, less expensive plywood... while still charging... for the more expensive, higher-quality plywood... ordered."

Meanwhile, Datillo admitted to giving away tickets to New York Yankees games and other gifts to those who the company was defrauding.

According to authorities, Dattilo "kept a running tally of how much Martignetti and others fraudulently billed customers, which many at Bayway Lumber referred to as the 'Bank,' to ensure that Bayway Lumber recovered the full cost of the free items."

According to a statement from the US Attorney's Office:

At Dattilo’s direction, Bayway Lumber inflated the prices on items sold or intentionally failed to provide the prices called for in contractual agreements between Bayway Lumber and customers, including the University of Medicine and Dentistry of New Jersey (UMDNJ) and its successor entities – Rutgers University and University Hospital...

These methods included: Concealing the true cost of items to Bayway Lumber, sometimes by manually altering vendor invoices, in order to enable Bayway Lumber to bill UMDNJ higher mark-ups.

In addition to the prison term, Judge Sheridan also ordered both to be subject to three years of supervised release after they get out of prison.

The business appears to have ceased operating, and its physical location at the corner of Ashton and Urbanowitz Avenues has been replaced by a company known as Garden State Building Supply.