Indictment Charges Civilian Navy Employees and Contractors With Fraud and Bribery

Indictment Charges Civilian Navy Employees and Contractors With Fraud and
Bribery

SAN DIEGO, July 7 /PRNewswire-USNewswire/ -- U.S. Attorney Karen P. Hewitt
announced today the unsealing of a 25-count indictment charging six
individuals with corruption and fraud charges related to defense contracting
at Space and Naval Warfare Systems Command (SPAWAR), a government organization
based in San Diego that is responsible for the development of technology to
collect, process, display and manage information essential to successful
military operations. A federal grand jury sitting in San Diego handed up the
indictment on June 30, 2009, which was sealed until their arrests earlier
today.

According to the indictment, federal employees Gary Alexander and his wife,
Kelly Alexander, worked at SPAWAR and for almost eight years accepted cash
bribes and other items of value from individuals seeking employment as
government subcontractors. Those charged with paying the bribes are Elizabeth
Ramos and Louis Williams, owners of Technical Logistics Corporation (TLC), a
company operating in National City. The indictment charges that Ramos and
Williams bribed Gary and Kelly Alexander with cash, a Rolex watch and other
items of value in return for Gary Alexander's using his influence at SPAWAR to
ensure the hiring of TLC as a subcontractor on several projects, including a
military drug enforcement project based in Key West, Fla. Throughout the
period of this scheme to defraud, TLC was paid approximately $4.8 million as a
government subcontractor.

The indictment also charges Jackie Godwin, a former manager at Kratos Defense
Security Solutions, Inc. (Kratos), a large San Diego-based defense prime
contractor, who hired the subcontractors as directed by Gary Alexander
according to the scheme. Finally, the indictment charges that Sinthia Nares
participated in the corrupt scheme and received government-funded jobs at both
TLC and Kratos.

According to the indictment, the defendants participated in an eight-year
scheme to defraud the government of its right to the honest services of both
Gary and Kelly Alexander and to obtain money and property through materially
false representations and omissions of material facts. In addition to
obtaining government contracts through bribery, the indictment alleges that
the defendants caused fraudulent bills to be submitted to and paid by the U.S.
government for personal goods and services, including: computer database
repairs; cell phone services; two 52-inch high-definition televisions; one
40-inch high-definition television; two home entertainment systems; a
PlayStation-3 system; a Blu-ray disc player; a digital camera and a global
satellite positioning system. The grand jury included in its indictment the
criminal forfeiture of the equipment, the Rolex watch, and the other items
constituting the proceeds of the fraud and bribery.

Defendants Gary and Kelly Alexander are also charged with three counts of
filing false tax returns by deliberately omitting income and disclosing only
their government salaries to the IRS. Finally, several of the defendants are
charged with lying to government agencies after providing false statements to
investigators.

Following the execution of search warrants in May 2008, Gary and Kelly
Alexander were placed on indefinite suspension from their jobs at SPAWAR, and
Godwin and Nares were fired from Kratos.

Also named in the indictment but charged separately was Pamela Banks, the
former owner of Advance Technical Solutions. Defendant Banks pled guilty in
August 2008, to bribing Gary Alexander in exchange for government
subcontracts. The current indictment alleges that Gary and Kelly Alexander
accepted the bribes from Banks in return for Gary Alexander's using his
official position at SPAWAR to have Banks hired by Godwin.

The indictment arose out of an 18-month investigation conducted by agents from
the FBI, the Defense Criminal Investigative Service, the Naval Criminal
Investigative Service and the Internal Revenue Service, Criminal
Investigation.

U.S. Attorney Hewitt said, "Each year, the United States spends billions of
taxpayers' dollars in San Diego and nationwide on defense procurement for
military operations. It is essential that the defense contracting process be
performed with integrity and fairness to all. According to the indictment in
this case, government officials charged here schemed with private contractors
to defraud the government and corrupt some of the contracting processes at
SPAWAR. Federal law enforcement officials will continue to investigate and
prosecute those who would attempt to corrupt the defense contracting process
or sell their positions of trust for personal gain."

FBI Special Agent-in-Charge Keith Slotter commented, "We are pleased that
concerned citizens have notified the FBI of their suspicions of public
corruption through our tipline. The individuals charged in this indictment
have taken advantage of their positions of trust -- positions bestowed upon
them by our government and its people. Undermining the public's interest for
personal gain will not be tolerated. The FBI thoroughly investigates
allegations of public corruption, and we remind the public to notify us, as
they are sometimes the one person that can make a difference."

"Corruption is always unacceptable, but it is especially detestable when it
involves those entrusted with protecting our war-fighters," said Richard W.
Gwin, Special Agent-in-Charge for the U.S. Department of Defense (DoD),
Defense Criminal Investigative Service (DCIS), Western Field Office. "While
the vast majority of DoD employees and DoD contractors are honest in their
work and committed to serving their fellow citizens, some choose to abuse the
public trust. Corruption of this nature strikes at the heart of good
government and erodes public confidence. The DCIS will use all tools available
-- our ability to track worldwide financial dealings, our advanced cyber
capabilities, our worldwide law enforcement alliances -- to protect taxpayers'
interests."

NCIS Special Agent-in-Charge of the San Diego Field Office Peter Hughes said,
"Procurement fraud wastes the taxpayers' money, corrupts the defense
contracting process, and potentially jeopardizes the safety of our men and
women in uniform. Whether a case of corruption occurs in Iraq, in Afghanistan,
or right here at home, the Naval Criminal Investigative Service will
aggressively investigate procurement fraud and pursue government contracting
officials who seek to abuse their positions of financial responsibility and
public trust for personal gain."

"Our tax system depends on everyone paying their fair share, and individuals
who intentionally circumvent our tax system for their own financial benefit
run the risk of prosecution," said Lance N. Okamoto, Assistant Special
Agent-in-Charge for IRS Criminal Investigation in the Los Angeles Field
Office. "IRS Criminal Investigation will continue to use our financial
expertise and work with our fellow law enforcement officers and the U.S.
Attorney's Office in conducting investigations that involve tax crimes and
other financial frauds."

The case is being prosecuted in the Southern District of California by
Assistant U.S. Attorneys Robert Ciaffa and AnnaLou Tirol.

SOURCE U.S. Department of Justice

Debbie Hartman of the Office of United States Attorney Karen P. Hewitt
Southern District Of California, +1-619-557-5610, FAX: +1-619-557-5782