A “rent-a-vet” scheme to fraudulently obtain $23.5 million in federal contracts reserved for disabled veterans ended with a guilty plea in federal court by the owner of a Nebraska construction company.

Ram Hingorani pleaded guilty last month to one count of major program fraud in connection with the scheme to obtain construction contracts with federal agencies using set-asides for owners of Service-Disabled, Veteran-Owned Small Businesses.

Two companies controlled by Hingorani also entered guilty pleas to separate charges related to fraud and money laundering.

The SDVOSB program is supposed to help veterans with service-connected disabilities obtain federal work by giving them a bidding preference when government contracts are awarded.

To qualify, the small business must be owned and controlled by a service-disabled veteran.

The Washington Examiner reported in a five-part series last year that lax oversight makes the program “highly vulnerable to fraud and abuse,” as seen in a series of federal investigations.

Rent-a-vet schemes are common. These involve the creation of a shell company, owned and controlled on paper by a qualifying veteran, but in reality run by another individual or firm.

That is what happened in Hingorani’s case, according to the 32-count indictment issued in 2013.

Midwest Contracting Inc. was supposedly created in 2007 by Ronald Waugh, a service-disabled Vietnam veteran and employee of one of Hingorani’s other firms.

In reality, Hingorani controlled MCI.

Between May 2007 and August 2010, MCI fraudulently received 45 federal contracts with the departments of Defense and Veterans Affairs using set-asides for SDVOSBs, according to prosecutors.

“The investigation revealed MCI was a pass-through and/or front company for Hingorani’s other businesses and that Waugh was simply a figurehead or ‘rent-a-vet’ who was being used for his SDV status,” according to the U.S. attorney’s office for the Southern District of Iowa. The guilty plea was made public Tuesday by the VA inspector general.

Those contracts were valued at $23.5 million. Federal agents previously seized about $3.9 million from 14 separate financial accounts linked to the scheme.

Hingorani faces up to two years in prison and forfeiture of all profits when he is sentenced.

Charges against Waugh will be dismissed as part of the plea agreement.