Navy contractor sentenced in $18M scheme
The founder of a U.S. Navy contractor from Georgia must serve three years in prison for his part in a kickback scheme that cost the Navy $18 million, a federal judge in Rhode Island ordered Wednesday.
Anjan Dutta-Gupta, of Roswell, Ga., founder of Advanced Solutions for Tomorrow, or ASFT, is the fourth person to be sentenced in a federal probe into a 15-year scheme led by former civilian Navy employee Ralph M. Mariano. Dutta-Gupta pleaded guilty in 2011 to bribery and was not sentenced until Wednesday while he cooperated with the investigation.
The sentence imposed by U.S. District Judge Mary Lisi matched the recommendation of both prosecutors and the defense, who said Dutta-Gupta's extensive cooperation almost immediately after he was charged meant he should be shown some leniency. Otherwise, he could have faced as much as 15 years in prison.
Mariano worked for the Naval Undersea Warfare Center in Newport, R.I., and was most recently based at the Navy Yard in Washington. He had the power to approve payments on Navy contracts and used it to sign off on false invoices submitted by ASFT and subcontractors, which would then funnel kickbacks to Mariano and others. ASFT, which also had offices in Middletown, R.I., went under soon after the charges were brought.
Dutta-Gupta apologized in court on Wednesday. His lawyer, David Fragale, told Lisi that his client thought keeping up the scheme was the only way to preserve the company. He believed, "This is how the Navy does business," and did not report it to anyone over the 15 years it went on because he didn't want to take on the Navy, Fragale said.
The Navy conducted an investigation at the Naval Undersea Warfare Center in 2011 and said it found no other wrongdoing. Outside court, Fragale said there were flaws in the Navy contracting system that has allowed taxpayer money to be wasted.
"I'd be extremely disappointed if the Navy believed that the problems within (the Naval Undersea Warfare Center) began and ended with Ralph Mariano," Fragale said.
Prosecutors said they estimated Dutta-Gupta himself received $2.5 million from the scheme. Fragale said he didn't know how they calculated that amount, but that the money Dutta-Gupta received went back into his businesses.
Lisi agreed that Dutta-Gupta provided an essential "road map" in the investigation, allowing the government to bring to justice some of the other players, including Mariano, who last week started a 10-year prison term. But the judge also pointed out that without Dutta-Gupta, the scheme to rip off the Navy and taxpayers of $18 million would never have worked. She said the sentence was meant to send a loud message to businessmen like him.
"If you get in bed with dogs, you end up with their fleas," she said.
Lisi also ordered him, along with some of the others convicted, to help pay $18 million in restitution. He must report to prison on Jan. 7.
Five others have pleaded guilty in the case, including Mariano, former ASFT executive Patrick Barry Nagle, who received three years of probation after his cooperation in the investigation, and Mariano's father, who received a two-year home confinement sentence for tax evasion. Awaiting sentencing on Thursday is Russell Spencer, an ASFT subcontractor, and on Friday is Mariano's girlfriend, Mary O'Rourke, who was an executive at ASFT.