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FBI probe into fraud at SEPTA looks at a second business, this one in N.J.

An investigation that began with workers at SEPTA is now probing businesses that conduct transactions with the transit agency.

SEPTA is in the midst of an investigation into possible fraudulent spending conducted by managers there.
SEPTA is in the midst of an investigation into possible fraudulent spending conducted by managers there.Read more

Federal agents’ investigation into fraudulent spending at SEPTA led them to a second business Monday, a source with knowledge of the investigation confirmed.

The business, Transportation Parts Suppliers in Bellmawr, sells chemicals, paper products, janitorial supplies, and “hard to find bus parts,” according to a ad. It was searched by agents Monday, the owner, James Pape, confirmed.

“They’re going through some things and they’re going through some questions, and I’m not going to say anything until I know what they’re dealing with,” Pape said. “I’m not concerned for myself.”

Transportation Parts Suppliers has been in operation since 2009 and occasionally does business with SEPTA, Pape said.

Pape said agents did not tell him what they were searching for. He declined to discuss any questions they asked him.

» READ MORE: FBI is investigating workers who misused funds at SEPTA

The FBI is conducting an investigation of facilities managers at SEPTA who may have misused the transit agency’s procurement cards, sources have said. Also Monday, agents visited a Delaware County business, MSI Tool Repair & Supply, on a court order. An FBI spokesperson would not say whether the agents’ activities in Camden County and Delaware County were related, or whether they were tied to the investigation at SEPTA. Sources with knowledge of the investigation, though, said the visits to both businesses were linked to the SEPTA investigation.

SEPTA did not respond Tuesday to questions about the Bellmawr business.

The investigation is focused on the conduct of fewer than a dozen SEPTA managers who allegedly fabricated fraudulent supply and repair invoices for construction projects, costing the agency in the range of hundreds of thousands of dollars, sources have said.

» READ MORE: Records show BRT worker sold parts to SEPTA on company time

The credit cards used are available to managers for smaller purchases as a way to bypass a long procurement process. The fraudulent charges were apparently tucked into legitimate purchases, sources said, with the agency being overcharged while the managers and the vendor kept the excess money charged to SEPTA.

The investigation, which has been ongoing for several months, has not led to any criminal charges.