It all started, the state says, when a subcontractor complained that he didn't get his kickback.
Authorities on Friday accused the owner of a Lancaster construction company of lying about using a minority-owned subcontractor, a state requirement on public projects.
And it charged the subcontractor – the man who complained about not getting paid – accusing his company of doing no work on the project.
"The genesis of this case came actually from one of the co-defendants who complained he didn't receive what was basically his kickback," State Inspector General Catherine Leahy Scott said Friday.
The people charged:
• Christopher M. Nichter, 57, of Lancaster. He faces 10 felony counts of falsifying documents in connection with a November 2015 contract for about $350,000 in work on the Buffalo Psychiatric Center, according to charges announced by the Inspector General's office and the Erie County District Attorney's Office on Friday.
• William C. McClendon, 41, owner of McClendon Asphalt Paving, a minority-owned company based in Niagara Falls. Nichter said McClendon's company would perform about $44,000 of plumbing and electrical work on the project.
• Angela A. Quinn, 44, of Lancaster. She was Nichter's office manager, according to the charges.
The investigation started about a year ago, Leahy Scott said, when McClendon complained to the state Dormitory Authority about not receiving payment from Nichter. The companies that actually performed the plumbing and electrical work were not aware of the scheme, she said.
State requirements called for 13 percent of the work on this project to be done by minority-owned businesses, Erie County District Attorney John J. Flynn said.
"These policies, these laws, are here to give everyone in this community a piece of the pie," Flynn said. "To have everyone have the opportunity to share in all the economic development that's going on here. We have a case here where that wasn't done."
Nichter's company has done other work under state contracts and the investigation remains ongoing, the inspector general said.
Nichter, McClendon and Quinn were arraigned in Buffalo City Court on Thursday and released on their own recognizance, authorities said.
Nichter is represented by attorney Paul J. Cambria Jr., according to Buffalo City Court officials. Cambria could not immediately be reached for comment.