ST. LOUIS – A former Clayton business owner and COO admitted in federal court that he committed fraud and sidestepped requirements that encourage the participation of minority-owned businesses in city contract opportunities.

Brian Kowert Sr. pled guilty Wednesday to two counts of wire fraud. He was a former co-owner and chief operating officer of HBD Construction Inc., a general contracting, construction management and development company in Clayton.

While operating HBD, Kowert also served as the acting as the project manager for the renovation and redevelopment of a building for Greater Goods LLC on Chouteau Avenue in St. Louis. Kowert and Charles Kirkwood, the owner of the Midwestern Construction company, agreed to falsely list Kirkwood’s company as providing materials and performing work on the project.

Kowert sought to falsify information to comply with St. Louis requirements for 25% participation by minority business enterprises, like Midwestern Construction, to qualify for a 10-year tax abatement. The MBE participation requirements seek to address historical social and economic disadvantages experienced by minority group members.

According to his plea agreement, Kowert used a series of measures to conceal his violations of the city’s MBE guidelines. In April 2020, Kowert issued duplicate HBD subcontracts to Kirkwood’s company for work that was performed and materials that were supplied by two other, non-MBE companies.

Later on, Kowert falsely listed Kirkwood’s MBE company as providing labor and materials valued at approximately $198,000 on the Greater Goods redevelopment project and falsely omitted the three non-MBE companies which actually did the work and provided the materials.

Between May 2021 and November 2021, Kowert and HBD proceeded with a false application for tax abatement on behalf of Greater Goods for the Chouteau Avenue redevelopment project. The application, submitted to the St. Louis Development Corporation, falsely represented that Kirkwood’s MBE company had performed around $225,000 in project costs and omitted the three non-MBE companies.

Greater Goods, the company seeking upgrade, had no knowledge of Kowert’s scheme, nor did its employees, per court documents.

Kowert is scheduled to be sentenced April 26. He could face up to 20 years in prison and $250,000 in fines.