Hill Air Force Procurement Manager: Cash Called Literature

The Hill Air Force procurement case involved a program manager who admitted in his guilty plea that he gave Atlas International Trading Company government budget and competitor bid information in exchange for bribes. The vendor was buying help from inside the office making the purchases. For someone who sees a budget, prepares a bid or handles a vendor payment, the case shows how those pieces can fit together: information traveled to the vendor, money traveled to the official, and the official helped the vendor win government work.

The manager pleaded guilty on October 24, 2011. He worked at Hill Air Force Base in Ogden, Utah, where the advantage he sold came with his procurement job.

What the Procurement Manager Could See

The manager worked in the Air Force’s Foreign Materials Acquisition Support Office. According to the Justice Department’s criminal-case account, Atlas contracted to provide foreign military materials to the government through that office. The company stood on the vendor side of a transaction whose government side employed the person it was paying.

Government budget information tells a vendor what the buyer has available to spend. Competitor bid information reveals what another seller has offered. The manager admitted disclosing both. The government paid him to run the purchase. So did the vendor.

The vendor owner’s plea agreement, described in the Justice Department’s January 2014 account of the vendor side, went beyond advance information. The owner admitted that the manager helped Atlas obtain and maintain contracts, receive payments on them, and get bid, proposal or source-selection information before awards. The assistance covered both winning the work and getting paid for it.

What Was Offered and What Was Received

The Justice Department’s account of the manager’s admissions puts approximately $1,240,500 in payments and other things of value on the offered side of the scheme. The manager admitted receiving more than $185,000 in payments and other things of value from approximately 2008 through August 2011.

The separate January 8, 2014 account described the vendor owner’s plea agreement. He admitted paying more than $180,000 in bribes and offering more than $1 million in additional bribes contingent on future contracts. That wording makes the incentive clear: more government work for Atlas meant more promised money for the official helping it.

The arrangement bought an ongoing relationship inside the purchasing office. The manager’s admitted help with obtaining contracts, keeping them and receiving payments explains why a vendor would promise more money for the next award. An employee who knew about the offer could see a part of the arrangement that a payment ledger alone would miss.

Cash Deliveries and an Account in Mexico

The Justice Department’s January 2014 account of the criminal court records described several routes from the vendor to the manager: cash sent to his home, payments made in person and wire transfers to Mexico. The January account also identified Atlas’s other owner as a participant in concealing the scheme. In her plea agreement, she admitted knowing about the bribes and helping hide them.

According to that account, the vendor owner sent nine FedEx packages to the manager’s home between November 2009 and August 2011. Each contained $5,000 in cash except the last, which contained $3,000 and was seized by law enforcement. The packages connect the business relationship to a delivery address outside the purchasing office.

The plea documents also described cash and other benefits handed over when the vendor owner and the manager traveled to the same place. The vendor owner bought the manager a laptop and software. For larger payments, the manager asked a cousin in Mexico to open a bank account, and Atlas’s other owner wired money to that account in the cousin’s name.

The same Justice Department account of criminal court records says the other owner also kept withdrawals from Atlas’s bank account small to avoid scrutiny. This is where someone handling company money could see a different piece of the scheme from someone preparing a bid: company cash left the business, while the benefit went to the official helping its contracts. The purchasing relationship and the payment relationship belonged to the same story.

Messages Built to Hide the Bargain

The Justice Department’s account of criminal court records also described covert email accounts, password-protected documents, false names and code words. The vendor owner and the manager created email accounts specifically for requests and offers of bribe payments. Inside their encrypted documents, even the money acquired a different name:

An insider familiar with the business vocabulary may recognize what an unusual message concerns before an outsider understands why it matters. The FBI and the Air Force Office of Special Investigations investigated the case. The admissions and court-record account connect several parts of the transaction: the procurement information, the requests for money, the benefits delivered and the favorable treatment the manager admitted providing. Those connections are what we help an insider lay out.

From Inside Information to Government Money

The manager’s help with contract payments makes the government’s purchasing and payment records central to the story. A bid file shows the offer put before the buyer. The accompanying communications can show what information the vendor had before making it, while payment and delivery records can show what the official received in return. Defense purchasing spreads those records across different roles, so someone with access to one part of the purchase may hold what the people handling another part never see.

When Buying Bid Information Leads to a Civil Case

Iraqi Consultants and Construction Bureau paid $2.7 million to resolve allegations that payments bought bid information from an Army Corps procurement official for Iraq reconstruction contracts. In its civil settlement announcement, the Justice Department also alleged that the company subsequently overcharged the government. The alleged advantage in winning the work and the alleged bills for that work were parts of the same case.

That comparison brings the information sale back to the government purchase. Understanding how competition for the contract was manipulated belongs beside understanding what the government was charged. For an insider, the useful connection may run from the person who shared the bid information to the vendor who used it and the payment that followed.

A whistleblower case under the False Claims Act can pay 15% to 30% of what the government recovers. We work with insiders to connect their knowledge of procurement decisions and payments to a defense contractor whistleblower case.

When You Saw the Information Change Hands

If you know how a vendor obtained a competitor’s bid or why company money reached a procurement official, speak with our whistleblower experts about that transaction. We connect the inside decisions to the government work, build the case with you and bring in defense procurement fraud whistleblower lawyers who understand how contracts are awarded and paid. We stay beside you as we build your strongest defense contractor whistleblower case.