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Saturday, March 7, 2015

2 FORMER CIVILIAN MILITARY EMPLOYEES AND A MILITARY CONTRACTOR CONVICTED IN BRIBERY SCHEME

FROM:  U.S. JUSTICE DEPARTMENT
Tuesday, March 3, 2015
Two Former Civilian Military Employees and One Military Contractor Convicted in Bribery Scheme at Georgia Military Base

Two former civilian employees at the Marine Corps Logistics Base (MCLB) in Albany, Georgia, and one military contractor were convicted by a federal jury today of bribery and fraud charges related to military trucking contracts, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and U.S. Attorney Michael J. Moore of the Middle District of Georgia.

Christopher Whitman, 48, co-owner of United Logistics, an Albany-based trucking company and freight transportation broker, was convicted of 43 counts of honest services wire fraud, five counts of bribery, five counts of obstructing justice and one count of theft of government property.  Shawn McCarty, 36, of Albany, Georgia, a former employee at the MCLB-Albany, was convicted of 15 counts of honest services wire fraud, one count of bribery and one count of obstructing justice.  Bradford Newell, 43, of Sylvester, Georgia, also a former employee at the MCLB-Albany, was convicted of 13 counts of honest services wire fraud, one count of bribery and one count of theft of government property.

According to evidence presented at trial, Whitman paid more than $800,000 in bribes to three former officials of the Defense Logistics Agency (DLA) at the MCLB-Albany, including the head of the DLA Traffic Office and McCarty, to obtain commercial trucking business from the base.  The transportation contracts were loaded with unnecessary premium-priced requirements, including expedited service, expensive trailers and exclusive use, which requires that freight be shipped separately from other equipment, even if that results in a truck not being filled to capacity.  As a result of these contracts, Whitman’s company grossed more than $37 million over less than four years.

The evidence further demonstrated that Whitman paid approximately $200,000 in bribes to the former inventory control manager of the Distribution Management Center at MCLB-Albany, Newell and others, who used their official positions to help Whitman steal more than $1 million in surplus equipment from the base, including bulldozers, cranes and front-end loaders.  In exchange for the bribes, Newell and the inventory control manager removed the surplus items from Marine Corps inventory and arranged to have them transported off the base by Whitman’s company.  Whitman then arranged to improve and paint the stolen equipment, and sell it to private purchasers.  

One former United Logistics employee, a business partner of Whitman’s, two former DLA officials and another MCLB official previously pleaded guilty for their roles in the fraud and corruption scheme.

The case was investigated by the Naval Criminal Investigative Service, with assistance from the Dougherty County District Attorney’s Office Economic Crime Unit, Defense Criminal Investigative Service, DLA Office of the Inspector General, and the Department of Labor Office of the Inspector General.  The case is being prosecuted by Deputy Chief J.P. Cooney and Trial Attorney Richard B. Evans of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorney K. Alan Dasher of the Middle District of Georgia.  The associated forfeiture litigation is being handled by Assistant Deputy Chief Darrin McCullough of the Asset Forfeiture and Money Laundering Section and the Middle District of Georgia.



Tuesday, March 3, 2015
Three Florida Men and a Corporation Convicted for Running Illegal International Gambling Enterprise
A federal jury in Oklahoma City convicted three Florida men and a Florida corporation today for their participation in an illegal international gambling and money laundering enterprise, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and U.S. Attorney Sanford C. Coats of the Western District of Oklahoma.

“In the age of the internet, what used to be a crime conducted by bookies on street corners is now an international criminal enterprise,” said Assistant Attorney General Caldwell.  “Operating on-line but off-shore, the individuals convicted in this case raked in more than a billion dollars in illegal gambling proceeds.  But as these convictions demonstrate, no matter where or how organized criminals operate, the Criminal Division will bring them to justice.”

“This is a great result in this important case,” said U.S Attorney Coats.   “I applaud the tremendous, collaborative efforts of our law enforcement partners and the prosecution team.”

Paul Francis Tucker, 50, of Mount Dora, Florida, Luis Robles, 50, of St. Pete Beach, Florida, and Zapt Electrical Sales Inc., a corporation registered in Florida and owned by Tucker, were found guilty of engaging in a racketeering conspiracy, conducting an illegal gambling business and conspiracy to commit money laundering.  Christopher Lee Tanner, 58, of Sarasota, Florida, was found guilty of conducting an illegal gambling ring.  A sentencing date will be set by the court in approximately 90 days, and the hearing will take place before U.S. District Judge Stephen P. Friot of the Western District of Oklahoma.

According to evidence presented at trial, from 2003 to 2013, Tanner, Tucker, Robles and Zapt Electrical Sales conspired with others to operate internet and telephone gambling services from Panama City, Panama through an enterprise known as Legendz Sports.  The international gambling enterprise took more than $1 billon in illegal wagers, almost exclusively from gamblers in the United States on American sporting events.

The evidence demonstrated that Tanner and Tucker worked as bookies in Florida, and illegally solicited and accepted sports wagers and settled gambling debts.  Tucker also used Zapt Electrical Sales and its bank account to launder gambling proceeds collected from losing bettors.  

The evidence showed that Robles worked as a runner for the enterprise, delivering cash to Legendz Sports bookies to make payouts and picking up cash profits from the bookies.  According to the evidence at trial, bookies and runners for Legendz Sports transported millions of dollars of gambling proceeds in cash and checks from the United States to Panama.  The checks were made out to various shell companies created by Legendz Sports all over Central America to launder gambling proceeds.

The case was investigated by the FBI and Internal Revenue Service-Criminal Investigation, with the assistance of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations and the U.S. Marshals Service.  The case is being prosecuted by Trial Attorney John S. Han of the Criminal Division’s Organized Crime and Gang Section and Assistant U.S. Attorneys Susan Dickerson Cox and Travis D. Smith of the Western District of Oklahoma.