fraud | The Contracting Education Academy

August 21, 2019 By cs

Former State Dept. employee pleads guilty to procurement fraud

The official had a social relationship with a furniture manufacturing executive, with whom she shared confidential contract information.

A former State Department official pleaded guilty last week to disclosing confidential proposal bids in an attempt to help a furniture company executive win a $1.56 million contract.

In December 2016, Patricia DeLaughter, former manager of the department’s Overseas Office Furniture Program, was working to solicit proposals for furnishing a new U.S. embassy when she and another department official knowingly disclosed the confidential bid prices and design plans of competitors to Steven Anstine, vice president of sales for an Overland Park, Kansas, manufacturing company, according to the Justice Department. Multiple news outlets, including The Post and Courier, identified the company as Bernhardt Furniture.

Keep reading this article at: https://www.govexec.com/management/2019/08/former-state-department-employee-pleads-guilty-procurement-fraud/159170/

June 12, 2019 By AMK

Defense contracting fraud: A persistent problem

During the five year period from 2013-2017, there were 1,059 criminal cases of defense contracting fraud resulting in the conviction of 1,087 defendants, including 409 businesses, according to a newly released Department of Defense report to Congress. There were another 443 fraud-related civil cases resulting in judgments against 546 defendants.

During that same period, the Department of Defense entered into more than 15 million contracts with contractors who had been indicted, fined, and/or convicted of fraud, or who reached settlement agreements. The value of those contracts exceeded $334 billion, according to the DoD report. See Report on Defense Contracting Fraud, DoD report to Congress, December 2018.

The report was prepared in response to a requirement in the FY2018 defense authorization act at the initiative of Sen. Bernie Sanders. It was released this week under the Freedom of Information Act.

A previous report covering the period of 2001-2010 was produced by the Department of Defense in 2011, also at the request of Senator Sanders. The earlier report likewise found extensive fraud including criminal and civil offensive in defense contracting.

“Simply put, the Pentagon continues to be riddled with waste, fraud and abuse of taxpayer funds to a degree unmatched across the federal government,” Sen. Sanders said in 2017. “It is unacceptable that the Department of Defense continues to lose vast sums of taxpayer money because of fraud perpetrated by major defense contractors. This has got to end.”

Keep reading article at: https://fas.org/blogs/secrecy/2019/05/defense-contracting-fraud

April 25, 2019 By AMK

State Dept. contracting officer indicted for bribery and procurement fraud

A 17-count indictment was unsealed today charging Zaldy N. Sabino, a contracting officer with the U.S. Department of State, with conspiracy, bribery, honest services wire fraud, and making false statements.

Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney G. Zachary Terwilliger of the Eastern District of Virginia, Inspector General Steve A. Linick of the U.S. Department of State and Assistant Director in Charge Nancy McNamara of the FBI’s Washington Field Office made the announcement.

According to the indictment, between November 2012 and early 2017, Sabino and the owner of a Turkish construction firm allegedly engaged in a bribery and procurement fraud scheme in which Sabino received at least $239,300 in cash payments from the Turkish owner while Sabino supervised multi-million dollar construction contracts awarded to the Turkish owner’s business partners and while Sabino made over a half million in structured cash deposits into his personal bank accounts. Sabino allegedly concealed his unlawful relationship by, among other things, making false statements on financial disclosure forms and during his background reinvestigation.

Keep reading this article at: https://www.justice.gov/opa/pr/state-department-contracting-officer-indicted-bribery-and-procurement-fraud

March 11, 2019 By AMK

DoD’s acquisition and contracting sees little improvement on GAO’s ‘high-risk’ list

Despite sweeping legislative and department changes over the past five years, progress on the Defense Department’s systems acquisition and contracting management remain basically stagnant on the Government Accountability Office’s 2019 High-Risk List of areas that are most vulnerable to waste, fraud and abuse.

The list, released last Wednesday, states efforts to shore up problems with DoD weapons systems acquisition remain “unchanged” since GAO’s last high-risk list in 2017. GAO made the same assessment of the Pentagon’s contract management issues, though with a few positive caveats.

The two items on the high-risk list account for almost $2 trillion in taxpayer funds — about $1.66 trillion in investments of 86 major weapons systems and $300 billion in annual contracted services for the Pentagon. Both of the items have been on GAO’s high-risk list since the early 1990s.

At the same time, GAO points out that the government’s inability to address climate change is causing national security issues and will cost DoD more money.

Keep reading this article at: https://federalnewsnetwork.com/defense-main/2019/03/dods-acquisition-and-contracting-sees-little-improvement-on-gao-high-risk-list/

December 12, 2018 By AMK

Oversight of U.S. military’s food suppliers called into question after fraud indictment

Executives from a company responsible for providing food and water for deployed U.S. troops in Afghanistan have been charged with defrauding the government and creating a fake construction site to overstate progress on an $8 billion contract, the Justice Department said in a recently filed indictment.

The allegations came four years after the company’s predecessor pleaded guilty to criminal charges that it inflated prices for basic items that it sold to the U.S. military. Both cases emphasize how the U.S. military has struggled to curb abuses of U.S. defense spending in America’s longest-running foreign war as the U.S. military presence in Afghanistan enters its 17th year, analysts said.

On Nov. 27, the Justice Department charged Abdul Huda Farouki, Mazen Farouki and Salah Maarouf — three Virginia residents who worked with a Dubai-based company called Anham Fzco — with defrauding the U.S. military under an estimated $8 billion military supply contract.

Keep reading this article at: https://www.washingtonpost.com/business/2018/12/08/oversight-us-militarys-food-suppliers-called-into-question-after-fraud-indictment/

The official had a social relationship with a furniture manufacturing executive, with whom she shared confidential contract information.

A 17-count indictment was unsealed today charging Zaldy N. Sabino, a contracting officer with the U.S. Department of State, with conspiracy, bribery, honest services wire fraud, and making false statements.

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