The offices of the Carabetta Management Company in Meriden, Conn. were raided this week by agents from the Federal Bureau of Investigation. The FBI seized boxes of records and computers from the family owned business’ headquarters, according to the Meriden Record-Journal.

Carabetta and a sister company, SRC Construction, were partners in the failed Magnolia Grove/ Moody Family Housing project. When the company defaulted on its contract and didn’t pay subcontractors for their work, the court stepped in and put the project into receivership. The project was sold to the Hunt Pinnacle Company in a public auction in 2008 and was then completed, although not nearly to the scale as originally planned.

Chris Crawford, communications director for Rep. Jack Kingston, said the FBI is not releasing the reason for the raid, stating that the search warrant is sealed as part of an ongoing federal investigation.

In 2007, when the project began to fall apart, both Kingston and Sen. Saxby Chambliss began working with the subcontractors and the military to attempt to bring some relief to those who lost their businesses due to non-payment for work they performed on the project.

Chambliss and Sen. Mark Pryor of Arkansas joined forces in calling for a federal investigation of the military housing contract that awarded the Carabetta family $3.3 billion in federal funds for work on military housing projects. These projects included a contract for housing at five military bases, including Moody and bases in Arkansas, Florida, Washington and Massachusetts.

At a press conference in 2008, Chambliss said, “The Air Force should have been more proactive to fix this problem before it got to this point. In my opinion, this issue is ripe for an Inspector General investigation to figure out what went wrong, why the contractor was awarded a $3.3 billion contract for privatized housing, covering five states, work on all of which has been halted.”

The Department of Justice stepped in and began an investigation in 2008, and the raid of the Carabetta offices is the first public indication that the investigation is continuing. It is unknown at this time if the military housing contract is the specific impetus behind the recent FBI raid or if there is a separate investigation underway on another federal matter involving the company.

 Prior to being awarded the contract as part of American Eagle Communities, the Carabetta family had a long and colorful history of problems with government contracts, financial issues, and a well-publicized divorce battle between Salvatore Carabetta, the principal in SRC Construction, and his wife, according to previous Times articles.

In the 1990s, Carabetta was suspended from government contracts for two years following an investigation into misappropriation of funds, including issues with HUD contracts. The company declared bankruptcy, but still managed to pass the Air Force’s contract review process less than 10 years later.

Issues began for the Moody Family Housing project in March of 2007, when subcontractors who complained about non-payment spurred the city/county inspections department to issue a work stoppage. The gates to the housing area were then padlocked by the company, and the subcontractors were unable to retrieve tools, equipment and materials on the site until a judge’s order allowed them entry.

By August of that year, the property was put into receivership and after several months of battling in the court system, the project was put up for public auction on the Lowndes County Courthouse steps. Hunt Pinnacle purchased the project.

At the time, numerous houses had been partially built on the property adjacent to Moody AFB, most of which had to be torn down as they were improperly sited and ruined by exposure to the elements. The housing development was completed and opened to military families but with far fewer homes than originally planned.

The money paid to the company by the Air Force but not paid to the subcontractors was not recovered. No explanation of where it went or how much Carabetta received prior to the project’s shutdown could be obtained due to the ongoing investigation.

Under the name MFH Development LLC, the company was able to retain 223 acres of land adjacent to its failed housing project and Moody, valued at $1.1 million. Lowndes County tax records show the taxes are current on the land. The address for the property owner is listed as 200 Pratt St., Meriden, Conn., the address where the FBI raid took place this week.

Despite their financial and federal woes, the Carabetta family and their various companies are considered to be strong community partners in their home state of Connecticut.

The Carabetta company is known as the builder and property manager for hundreds of housing units, according to the Meriden Record-Journal. The newspaper states that a company attorney once estimated that Carabetta built about one-third of the single-family houses in Meriden, and the company has partnered in numerous HUD and commercial projects in the Northeast.

The Record-Journal also quotes Meriden city officials concerning the company. They state that the Carabetta organization is the second largest taxpayer in the city, and that they are known for their charitable contributions.

Reporters from the Record-Journal contacted The Times this week concerning the federal raid and have been generous in sharing information about the company.