Two Defense Contractors Arrested for Bribery and Major Fraud Conspiracy Scheme Affecting Department of War Technology Innovation Contracts

Today, the Justice Department announced criminal charges against Leonard Pick, 62, of Palm Beach Shores, Florida, and Brian Kent, 59, of Tampa, Florida, for orchestrating a bribery and major fraud conspiracy that corrupted the competitive procurement process for a Department of War technology innovation lab in the Pacific. The defendants' alleged conduct specifically affected the construction and operation of the U.S. Army Pacific Command's Hawaii-Pacific Innovation Campus, which was intended to be a hub for testing new technologies for the Department of War.

The indictment, filed in the District of Hawaii on May 14 and unsealed today, alleges that, from January 2021 to October 2022, Pick and Kent conspired to bribe a U.S. Army employee with approximately $1.25 million over five years and fraudulently inflated government contracting costs to include the U.S. Army employee's bribe payments. The indictment further alleges that, from approximately September 2020, up to and including October 2022, defendant Kent further defrauded the government by inflating government contract costs to include approximately $680,000 in payments intended for and sent to Kent's personal consulting business.

"When defense contractors obtain government-funded work through bribery and fraud, they rob our military and the American people of the benefits of a fair, competitive procurement process," said Acting Deputy Assistant Attorney General Daniel W. Glad of the Justice Department's Antitrust Division. "The Antitrust Division and its partners in the Procurement Collusion Strike Force will vigorously prosecute those that seek to profit at the expense of American taxpayers."

"Government contracts must be awarded based on fair competition, not secret bribes hidden in inflated costs," said Acting Director of Criminal Enforcement Paul V. Courtney of the Justice Department's Antitrust Division. "Those who corrupt the procurement process and defraud the American taxpayer should know this: we will find you, prosecute you, and hold you accountable."

"Corruption in our military procurement processes harms honest companies seeking to compete fairly, steals from our taxpayers, and erodes faith in our government institutions," said U.S. Attorney Ken Sorenson for the District of Hawaii. "We remain committed to holding accountable in federal court any defense contractors who attempt to undermine fair competition through bribery and corrupt practices."

"The criminal conduct uncovered in this investigation represents a profound betrayal of the public trust," said Special Agent in Charge David Porter of the FBI Honolulu Field Office. "The defendants used bribery and fraud to obtain significant defense contracts, prioritizing personal profit over national security. Let this serve as a clear warning - the FBI and our federal partners will aggressively pursue and hold accountable anyone who attempts to corrupt government procurement processes for personal gain."

"Those who scheme for ill-gotten profits through unscrupulous and shady dealings should take heed of these very serious charges," said Special Agent in Charge Stanley A. Newell of the Department of War, Office of Inspector General's Defense Criminal Investigative Service (DCIS), Transnational Operations Field Office. "Swindling the American taxpayers through corruption and fraud will never be tolerated by the dedicated professionals of DCIS and our partner agencies. We are steadfast in our commitment to ensure the integrity of the U.S. military procurement system and hold those who threaten it accountable."

"Those who attempt to corrupt government processes for personal gain undermine public trust," said Special Agent in Charge Christopher Bjornstad of the U.S. General Services Administration Office of Inspector General Western Investigations Division. "GSA OIG special agents will continue working with our law enforcement partners to thoroughly investigate those who abuse positions of trust and responsibility."

Defendants Pick and Kent are each charged with one count of conspiracy to commit bribery and major fraud against the United States, one count of bribery, one count of major fraud against the United States, and one count of wire fraud. Kent is also charged with a second count of major fraud against the United States. The maximum penalty for conspiracy to commit bribery and major fraud is five years in prison and a $250,000 fine. The maximum penalty for bribery is 15 years in prison and a fine of either $250,000 or three times the monetary value of the bribe, whichever is greater. The maximum penalty for major fraud against the United States is 10 years in prison and a $1,000,000 fine. The maximum penalty for wire fraud is 20 years in prison and a $250,000 fine. The fines may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime if either amount is greater than the statutory maximum fines. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

These indictments result from ongoing federal investigations into fraud and collusion in the defense contracting industry in Hawaii. The investigation is being conducted by the Antitrust Division's San Francisco Office, the U.S. Attorney's Office for the District of Hawaii, the Federal Bureau of Investigation, the Department of the Army Criminal Investigative Division, the U.S. Department of Defense's Defense Criminal Investigative Service, the U.S. General Services Administration's Office of Inspector General, and the Naval Criminal Investigative Service (NCIS). Trial Attorneys Nolan Mayther, Andrew Schupanitz and Kylie McLaughlin, and Senior Litigation Counsel Mikal Condon, are prosecuting the case.

The Justice Department's Procurement Collusion Strike Force (PCSF) is a joint law enforcement effort to combat antitrust crimes and related fraudulent schemes that impact government procurement, grant and program funding at all levels of government - federal, state and local. To learn more about the PCSF, or to report information on bid rigging, price fixing, market allocation and other anticompetitive conduct related to government spending, go to https://www.justice.gov/procurement-collusion-strike-force.

Whistleblowers who voluntarily report original information about antitrust and related offenses that result in criminal fines or other recoveries of at least $1 million may be eligible to receive a whistleblower reward. Whistleblower awards can range from 15 to 30 percent of the money collected. For more information on the Antitrust Whistleblower Rewards Program, including a link to submit reports, visit https://www.justice.gov/atr/whistleblower-rewards.

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