Senior Officer of AvalonBay Communities, Inc., Pleads Guilty

( Alexandria , VA ) - James R. Willden, age 38, of Fredericksburg, Virginia, pled guilty today to one count of conspiracy to commit mail fraud. Dana J. Boente, Acting United States Attorney for the Eastern District of Virginia, and Joseph Persichini, Jr., Assistant Director in Charge, Federal Bureau of Investigation, Washington Field Office, made the announcement after the plea was accepted by United States District Judge Claude M. Hilton.

Sentencing has been set for March 13, 2009. Willden faces a maximum penalty of five years incarceration, a $250,000 fine, and full restitution.

According to documents, Willden admitted that he had participated in a $5 million scheme to defraud AvalonBay Communities, Inc., (AvalonBay) an equity Real Estate Investment Trust primarily engaged in developing, acquiring, and managing apartment communities within the United States. AvalonBay maintains its corporate offices in Alexandria, Virginia. Until his resignation in November 2006, Willden was AvalonBay's Vice President of Engineering, in charge of capital improvements and environmental safety for a number of AvalonBay apartment communities throughout the United States.

Documents also stated that, Willden conspired with Michael Schroll, the owner and chief executive officer of San Jose Water Conservation Corporation, a company that either installed or retrofitted toilets with a low flow technology that enabled the toilets to conserve water. From the late 1990s until November 2004, in connection with the installation of low flow toilets on AvalonBay properties, Willden solicited and accepted from Schroll kickbacks in the amount of at least $312,000. In addition, from mid 2004 until November 2006, Willden arranged for AvalonBay to pay Schroll's company, either directly or through a prime contractor, $5.4 million to perform mold removal or maintenance work on AvalonBay properties, when Schroll's company performed no services. Schroll returned the bulk of those funds to Willden as a kickback. In return for facilitating the scheme, Willden allowed Schroll's company to retain $1.2 million of AvalonBay funds. On October 15, 2008, in Alexandria, Virginia, Michael Schroll pleaded guilty to one count of conspiracy and is scheduled to be sentenced before Judge T. S. Ellis, III, on January 23, 2009.

Willden also admitted in the statement of facts that, in order to facilitate the payments to Schroll's company, he conspired with a senior employee of Tetra Tech, Inc., a company specializing in environmental cleanup and engineering, at its office in Colorado. Tetra Tech ostensibly hired Schroll's company to perform mold removal services on AvalonBay properties, when Schroll's company performed no services.

This case was investigated by the Federal Bureau of Investigation. Assistant United States Attorney Stephen P. Learned is prosecuting the case on behalf of the United States.

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