State Department Official Patricia DeLaughter Pleads Guilty to Procurement Fraud

 

On August 9, 2019, USDOJ announced that State Department employee, Patricia DeLaughter pled guilty to disclosing confidential State Department bid proposals n an effort to help a furniture company executive win a lucrative government contract. Sentencing is scheduled for November 8, 2019.

Photo via State Magazine, April 2009

Via USDOJ: State Department Official Pleads Guilty to Procurement Fraud

ALEXANDRIA, Va. – A Washington, D.C., woman pleaded guilty today to disclosing confidential State Department bid proposals in an effort to help a furniture company executive win a lucrative government contract to provide furniture to a United States embassy abroad.

According to court documents, Patricia DeLaughter, 69, was a State Department official who was responsible for procuring furniture for United States embassies. In or around December 2016, the State Department was constructing a new embassy in a foreign nation. DeLaughter and another Department official participated in the process of soliciting bid proposals from contractors for the procurement of furniture for the new embassy’s offices.

From in or around December 2016 to in or around March 2017, DeLaughter and the other State Department official knowingly disclosed to Steven Anstine, the vice president of sales for an American furniture manufacturer, the confidential bid prices and design plans of at least three of Anstine’s competitors. DeLaughter knowingly disclosed this information in order to give Anstine—with whom DeLaughter had a social relationship—a competitive advantage in securing the procurement contract for the new embassy. The information that DeLaughter and her coworker gave Anstine enabled him and his company to win the contract with a bid of approximately $1.56 million.

According to DeLaughter’s admissions, DeLaughter made intentionally false statements to agents investigating her conduct. She falsely told State Department Office of Inspector General special agents that she had nothing to do with the embassy furniture project. She also falsely told the agents that she did not have a social relationship with Anstine. In fact, DeLaughter and Anstine had a social relationship and attended dinners, sporting events, and concerts together. Anstine paid at least a portion of DeLaughter’s expenses for these events.

In June 2019, Anstine pleaded guilty to one count of illegally obtaining contractor bid or proposal information in the U.S. District Court for the District of South Carolina.

DeLaughter pleaded guilty to one count of illegally disclosing contractor bid or proposal information and faces a maximum penalty of five years in prison when sentenced on November 8. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, Brian A. Benczkowski, Assistant Attorney General for the Justice Department’s Criminal Division, and Steve A. Linick, Inspector General for the Department of State, made the announcement after U.S. District Judge Rossie D. Alston Jr. accepted the plea. Special Assistant U.S. Attorney Russell L. Carlberg, Deputy Chief Robert J. Heberle and Trial Attorney John P. Taddei of the Criminal Division’s Public Integrity Section are prosecuting the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:19-cr-205.

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@StateDept Contracting Officer Faces 17-Count Indictment For Bribery and Procurement Fraud

On April 4, the Justice Department announced a 17-count indictment charging State Department contracting officer, Zaldy N. Sabino with conspiracy, bribery, honest services wire fraud, and making false statements. The indictment notes that the defendant was employed by the State Department beginning in or about November 2004 at AQM, the Office of Acquisitions Management:

“SABINO served as a contract specialist with AQM, and he was also a contracting officer who was authorized to execute certain contracts on behalf of the DOS. SABINO worked in AQM’s Facilities Design Construction Division (“FDCD”) in Arlington, Virginia. FDCD supported and administered contracts involving the DOS’s Bureau of Overseas Buildings Operations (“OBO”). OBO frequently awarded contracts to international construction companies seeking to do business and perform design-build contracts at U.S. embassies and consular buildings.”

The Office of Acquisitions Management under the Bureau of Administration (A/OPE/AQM) manages, plans, and directs the Department’s acquisition programs and conducts contract operations in support of activities worldwide. A/OPE/AQM provides the full range of professional contract management services including acquisition planning, contract negotiations, cost and price analysis, and contract administration.

Via USDOJ:

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.

The case is being investigated by the Department of State’s Office of Inspector General and the FBI’s Washington Field Office.  Trial Attorney Edward P. Sullivan of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorney Jack Hanly of the Eastern District of Virginia are prosecuting the case. 

An indictment is merely an allegation.  All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

Read the original announcement here.

Under “Means and Manner of Conspiracy”, the Indictment enumerates multiple cash payments and withdrawals. Allegation includes “deposited cash into bank accounts maintained by SABINO and his wife, and SABINO paid cash towards his credit card and line of credit accounts (hereafter collectively referred to as “cash deposits”). The cash deposits totaled approximately $507,543.93.” Another allegation includes withdrawal of approximately $239,300″ involving “approximately 396 ATM transactions. ” The indictment alleges that “the majority of these transactions occurred in the lobby of a DOS building” in Arlington, Virginia and BOA branches located near the defendant’s residence in Fort Washington, Maryland.

The unsealed indictment is available to read here: Download Sabino Indictment

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