Criminal Cases

  1. Gallery of Greed
  2. Recent Criminal Cases
Gallery of Greed

 U.S. reconstruction activities in Afghanistan, or any other conflict zone, face the constant threat of criminal conspiracies among personnel who rotate in and out of theater, infecting their successors with the virus of corruption.

 Over the past five years, SIGAR’s Investigations Directorate has uncovered and detailed a classic example of this threat—an extended, widespread, and intricate pattern of criminality involving U.S. military personnel and Afghan contractors at the Humanitarian Assistance Yard (the Yard) at Bagram Airfield near Kabul, Afghanistan.

 In June 2012, SIGAR investigators following leads uncovered an unusual pattern of suspect criminal activity at the Yard. They found traces of criminal activity affecting inventories, accounting, issuance of supplies, payments, and contract oversight at the Yard, which serves as a storage-and-distribution facility for millions of dollars’ worth of clothing, food, school supplies, and other items purchased from local Afghan vendors. U.S. military commanders provided those supplies to displaced Afghans as part of the Commander’s Emergency Response Program (CERP) to meet urgent humanitarian relief needs for the Afghan people.

 As the SIGAR investigators, conducted interviews, checked records, and scrutinized other evidence, they confirmed that U.S. military personnel, stateside contacts, and local Afghans had conspired in bribery, fraud, kickbacks, and money laundering. Among other improper acts, U.S. personnel took bribes from vendors or from Afghan interpreters who wanted to steer supplypurchase business to favored vendors.

 The conspiracies pervaded activities at the Yard, and persisted for years as new personnel were assigned there and, in some cases, adopted the corrupt practices of their predecessors or their new colleagues. Some of the participants stayed involved remotely after they returning to the United States.

 The SIGAR investigation, whether conducted independently or in cooperation with the International Contract Corruption Task Force, focused on suspect paying agents and project purchasing officers responsible for administering the replenishment contracts and on military members responsible for paying vendors.

 The assembled evidence of corruption from this investigation led to a series of guilty pleas, prison terms, and forfeiture agreements as offenders were held accountable for their deeds and their dereliction of duty. The following gallery presents summaries of cases resolved or in progress as a result of the work performed by SIGAR Investigations Directorate. The stories illustrate the reality that no matter how well designed a procurement system may be, it requires strict oversight and accountability for the people who operate the mechanism.

Timothy H. AlbrightTimothy H. Albright:

An enlisted specialist with the Pennsylvania National Guard, Albright served at Bagram Airfield between January and October 2008 processing Afghan vendors’ invoices for resupplying goods at the Yard. During that time, according to court documents, Albright accepted several payments, ranging from $200 to $10,000, for accelerating payments on an Afghan vendor’s invoices. Albright’s supervisor and an Afghan interpreter allegedly were also involved in the scheme. About $25,000 from the payments was deposited into Albright’s and his wife’s bank account; they used $18,000 of it to buy a car. Albright pled guilty to conspiracy to receive bribes, and on January 27, 2016, was sentenced to a year and a day in prison. He was also ordered to forfeit $16,200 and the car, a 2008 Nissan Maxima. Noting Albright’s previous military service, his post-traumatic stress disorder, and his family’s support, Judge John E. Jones III told Albright during his sentencing, “This case is the proverbial dog’s breakfast. It’s a lousy, lousy deal for everybody involved, but it’s a situation that you caused [by repeatedly taking bribes] and you know it.”

Louis M. BaillyLouis M. Bailly:

Between October 2011 and October 2012, Army Staff Sergeant Bailly served at the Yard, and was a project purchasing officer for part of that time. In 2015, the U.S. government filed charges that Bailly had conspired with two Afghan contractors, accepting about $12,000 in bribes for influencing supply-replenishment contracts. Bailly pled guilty to one count of conspiracy to commit an offense or to defraud the United States, and was sentenced to a year and a day in federal prison, followed by a year of supervised release, and forfeiture of $10,000.

Donald P. BunchDonald P. Bunch:

U.S. Navy senior chief, Bunch served from February to August 2009 as yard boss at the Yard, and was responsible for resupplying supplies like rice, beans, and clothing, and overseeing truck loading in support of the Commander’s Emergency Response Program. Federal authorities charged that he took some $25,000 in payments from multiple Afghan vendors in return for moving their firms up in the normal rotation of suppliers, and for giving them larger and more lucrative contracts. Bunch pled guilty to one count of bribery, that is, of accepting something of value by a public official to influence the performance of an official act. In March 2016, he was sentenced to 24 months in federal prison and then 24 months of supervised release, fined $5,000, and agreed to forfeit $25,000.

The presiding judge at Bunch’s trial told him, “This is not only a disgrace to the uniform that you wear and a disgrace to the country . . . , but also [serves] to encourage this type of corruption and allow it to become more widespread. . . . It undermines the authority and the position of those in government, it undermines the government itself, and it certainly, in Afghanistan and the Middle East, it undermines our efforts at trying to help those people and promote the causes that we’re trying to defend.”

Jerry W. DennisJerry W. Dennis:

Dennis was a resident of Horn Lake, Mississippi, whose son Jimmy was a U.S. Army first sergeant serving as a paying agent at the Yard. The federal criminal information document filed against Jerry Dennis charged that for a period extending up to about January 2010, Dennis conspired with his son and with landscaper friend James C. Pittman to have containers of cash from bribes shipped out of Afghanistan and handled in ways that would disguise their nature, ownership, and location. In July 2014, Jerry Dennis pled guilty to one count of conspiracy to commit money laundering. He was placed on probation for two years, including six months’ home confinement, and forfeited $110,000 per a court-approved agreement.

Jimmy W. DennisJimmy W. Dennis:

The son of Jerry Dennis (above), Jimmy W. Dennis was a U.S. Army first sergeant serving as a paying agent at the Yard from March 2008 to March 2009. Federal authorities charged him with conspiring with his father and a Chattanooga, Tennessee, landscaping-company owner, James C. Pittman, to move about $250,000 in bribes from Afghanistan to the United States. Dennis and Pittman knew each other from serving together at Fort Campbell, Kentucky, previous to Dennis’s deployment to Afghanistan. Jimmy Dennis pled guilty to one count of conspiracy to commit money laundering. In January 2015, he was sentenced to 41 months’ imprisonment, followed by two years’ supervised release. He also agreed to and has forfeited $115,000 and a Rolex watch.

Ramiro Pena Jr.Ramiro Pena Jr.:

Between January 2008 and September 2009, Army Sergeant First Class Pena served as a project purchasing officer at the Yard, maintaining supply orders and inventory levels. His supervisor was First Sergeant Jimmy Dennis (see above). The men processed more than 200 contracts with Afghan vendors worth about $30.7 million total. The federal charge against Pena said Dennis gave him about $100,000 and a Rolex watch from vendor bribes received, and that Pena had shipped money home to his wife. Pena pled guilty to one count of conspiracy to defraud the United States, and in December 2015 was sentenced to 24 months in prison, followed by a year’s supervised release. He agreed to forfeit $100,000 and has forfeited a Harley-Davidson motorcycle and Rolex watch.

James C. PittmanJames C. Pittman:

Proprietor of a Chattanooga, Tennessee, landscaping company, Pittman was charged with conspiring with Jerry and Jimmy Dennis (see above) to transfer and launder funds received as bribes in Afghanistan. Pittman had left the military before Jimmy Dennis worked at the Yard, but was still in contact. The charge was that “on numerous occasions,” Pittman received containers of cash from Afghanistan via the Dennises, passed it through his business, and returned most of it to Jerry and Jimmy Dennis as checks for “salary.” Having pled guilty to conspiring to commit money laundering, Pittman was sentenced to a year and a day in prison, followed by a year’s supervised release. He also consented to and has forfeited $25,000.

The judge at Pittman’s trial noted that “There’s others out there that find themselves in a similar situation to you that would be tempted . . . to do what you did. That is going to be a large part of the sentence I impose today.”

Pittman marveled that “the Government can track your butt down after five years—”

“It’s pretty impressive, isn’t it?” the judge interjected.

Pittman continued. “Old friends and acquaintances from, you know, nearly 14 years in and, you know, text me . . . or whatever and be like, holy crap, you know, they caught you? . . . And I was like . . . they can find you anywhere.”

David A. TurciosDavid A. Turcios:

David A. Turcios, a U.S. Air Force staff sergeant, began working at the Yard in November 2010 as a paying agent and contracting officer representative, and was involved with nine CERP supply contracts worth more than $2 million. Turcios worked closely with two Afghan interpreters who gave him names of vendors they were proposing for contracts. They gave Turcios gifts, jewelry, and thousands of dollars, some of which was not paid until after Turcios returned to the United States.

On October 23, 2018, in the Eastern District of California, Turcios was sentenced to 12 months’ probation and ordered to pay a $1,000 fine and $500 forfeiture, after pleading guilty to receiving and agreeing to receive a bribe.

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Recent Criminal Cases

Subject Action Investigative Activity
Naim Ismail Sentencing Investment Firm Vice President Sentenced for Running Multimillion-Dollar Ponzi Scheme

On July 27, 2022, in the United States District Court for the Southern District of New York, Naim Ismail was sentenced to 70 months of incarceration with credit for time served domestically. Credit was not granted for time served while detained in the United Arab Emirates. Additionally, Ismail was ordered to pay a forfeiture to his victims in the amount of $10.2 million.

Ismail participated in various investment schemes that defrauded victims of over $15 million. From February 2007 through July 2016, he fraudulently induced individual and corporate victims—including the New York-based subsidiary of an Afghanistan-based bank—to loan large sums of money to entities operated by Ismail and others. Ismail did so by claiming that these funds would be used in an investment strategy and in several real estate development projects. He offered investors a generous fixed annual rate of return and promised to return the investors’ principal on a specified timeline. Ismail and his companies did not invest these funds as promised, nor did he repay many of his victims. Instead, he used investor funds to pay the so-called interest payments due to earlier investors in the scheme, as well as for his own personal expenses and investments.

SIGAR and Homeland Security Investigations (HSI) jointly conducted the investigation.

Zachary A. Friedman Guilty Plea Former U.S. Defense Contractor Executive Pleads Guilty to Charges of Tax Evasion

On August 25, 2022, in the U.S. District Court for the District of Columbia, Zachary A. Friedman pleaded guilty to tax evasion. A criminal information was filed against Friedman on August 1, 2022.

Friedman worked in the United Arab Emirates as a senior executive for a US Defense Contractor, a U.S. Department of Defense fuel supply contractor based in Kyrgyzstan, Afghanistan, and Dubai. From 2013 until 2015, Friedman evaded taxes he owed to the IRS by providing false information to his tax preparer, thereby underreporting the income he earned for each of the three years. In total, Friedman concealed approximately $530,000 of income, causing a tax loss to the U.S. government of more than $207,000.

Friedman is the fourth defendant associated with the US Defense Contractor to plead guilty. He faces a maximum penalty of five years in prison, a period of supervised release, and monetary penalties. SIGAR initiated the investigation at the request of the Department of Justice Tax Division and worked concurrently with the IRS-CI International Tax and Financial Crimes Group. The Joint Chiefs of Global Tax Enforcement (J5)— comprising the taxing authorities of Australia, Canada, Netherlands, United Kingdom, and the United States—assisted.

Paul Daigle, Keith Woolford Sentencings Two Former Company Executive Officers Sentenced for Fraud

On July 29, 2022, in the Northern District of Alabama, Paul Daigle was sentenced to three years of probation with six months of home confinement and was ordered to pay $52,968 in restitution. On July 29, 2022, Daigle’s co-conspirator, Keith Woolford, was also sentenced to three years’ probation with six months’ home confinement and was ordered to pay $52,968 in restitution.

Daigle and Woolford were executives for AAL USA, a Department of Defense subcontractor engaged in the repair and maintenance of aircraft in Afghanistan under contracts issued from Red Stone Arsenal in Huntsville, Alabama. Chief Executive Officer Daigle and Chief Financial Officer Woolford perpetrated a scheme to fill contract labor positions with employees who did not meet the education requirements, and in some cases, with employees who were not actually assigned work on the contract. As part of the fraud, they instructed employees to obtain fake college degrees from an online diploma mill in order to satisfy the requirements of the labor categories contained in the statement of work for a U.S. government contract. As a result of the scheme, false invoices were created and passed to the prime contractor and then on to the U.S. government for payment.

The investigation was conducted by SIGAR, Defense Criminal Investigative Service (DCIS), and the U.S. Army Criminal Investigation Division (CID)-Major Procurement Fraud Unit.

Bernard Barrington Forfeiture Former U.S. Military Member Forfeits $52,000 to U.S. Government

On September 9, 2022, former U.S. Army Warrant Officer Barrington Bernard and his counsel signed a SIGAR letter indicating Bernard’s intent to forfeit $52,000 to the U.S. government via the Defense Finance and Accounting Service (DFAS).

Bernard received bribe payments in the amount of $52,000 from an Afghan trucking company from 2007 to 2009, while he was assigned to Bagram Air Force Base, Afghanistan. A joint investigation was initiated by SIGAR and the U.S. Army CID after a witness reported allegations of bribery involving Bernard. In a subsequent interview, Bernard admitted to having received approximately $52,000 in bribe money and he voluntarily agreed to forfeit the money as allowed by law and regulation.

SIGAR and CID referred the matter to the DFAS to facilitate disposal of the funds to the U.S. Treasury.

Mustafa Neghat, Abdul A. Qurashi Sentencings Former Employees of U.S. Government Contractor Sentenced for Fraud Scheme

On July 20, 2022, in U.S. District Court, District of Columbia, Mustafa Neghat was sentenced to 12 months of supervised probation after pleading guilty to one count of conspiracy to commit offenses against the United States.

On September 22, 2022, in the U.S. District Court, District of Columbia, Abdul A. Qurashi was sentenced to 12 months of unsupervised probation after pleading guilty to one count of conspiracy to commit offenses against the United States.

Neghat and Qurashi were employed by a U.S. government contractor to recruit candidates for positions as language interpreters working with the U.S. military. They circumvented procedures designed to ensure candidates met minimum proficiency standards, which resulted in unqualified language interpreters being hired and later deployed alongside U.S. combat forces in Afghanistan. To carry out this scheme, they conspired with others to commit wire fraud and major fraud against the United States. Both obtained financial bonuses from their employer based on the number of candidates hired through their efforts.

To date, five co-conspirators have pleaded guilty as a result of the SIGAR-led investigation.

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