Sorry it’s been so long since I last posted. I took a few weeks off for the holidays and then tried and won a defamation trial in Virginia last month, sort of. It’s back to the grindstone now, though. There were quite a few interesting white-collar cases in the last six weeks so I’ll be playing catch up in my next few posts. Glad to be back!
A Florida couple and a Utah-based military procurement officer were sentenced in January 2014 for a three-year bribery scheme that involved foreign military aircraft contracts.
Sylvester Zugrav, who is 70 years old, was a co-owner of Atlas International Trading Company with his wife Maria Sugrav, who is 67 years old. The Zugravs offered and paid bribes to a U.S. Air Force procurement officer named Jose Mendez.
The Zugravs and Mr. Mendez were indicted in October 2011 for bribery, conspiracy and procurement fraud. The indictment alleged that Mr. Mendez worked for the Air Force’s Foreign Materials Acquisition Support Office (FMASO). FMASO is in charge of buying foreign military goods for use by the U.S. military. Needless to say, the military does not let just anyone sell foreign military goods to the military, and Atlas was an authorized vendor of such goods.
The Zugravs offered and paid bribes to Mr. Mendez in return for disclosure of “government budget and competitive bid information,” as well as “favorable treatment to ATLAS in the FMASO contract procurement process.” All told, the Zugravs offered to pay Mr. Mendez $1,240,500 in bribes. In his plea agreement (to be precise, his “Statement in Advance of Plea of Guilty”), Mr. Zugrav admitted that he did pay Mr. Mendez nearly $190,000 in bribes.
The bribes were sometimes sent in cash to Mr. Mendez’s residence via FedEx, sometimes paid in person and sometimes wired to a relative of Mr. Mendez’s in Mexico. Mr. Zugrav also admitted that he and Mr. Mendez took steps to conceal their fraud, including using covert e-mail accounts, code words, encrypted documents and false names.
Mr. Zugrav pleaded guilty to conspiracy to commit bribery (18 U.S.C. § 371) and was sentenced in early January 2014 to 15 months in prison.
Ms. Zugrav pleaded guilty to withholding information on a crime (18 U.S.C. § 4) and was sentenced to 24 months’ probation.
In October 2011, Mr. Mendez pleaded guilty to conspiracy to commit bribery and procurement fraud, fraud, bribery and procurement fraud. In late January 2014, he was sentenced to 24 months in prison.
Interesting fact. Mr. Zugrav was represented by John L. Brownlee, who is currently representing former Virginia Governor Robert McDonnell in his public corruption case. Governor McDonnell’s wife is also charged in that indictment. The McDonnells’ case may have a very different outcome than the one for the Zugravs. The Washington Post reported that Mr. McDonnell turned down a deal that would have resulted in a single felony conviction for him and charges dropped against his wife. It’s impossible to tell if Mr. Zugrav made this kind of deal to let his wife go free, but it appears that Governor McDonnell chose not to.