According to a statement from the IRS, Hancock and co-conspirator Karen K. Paulsen, of Beavercreek, helped former Air Force civilian employee Keith Alan Seguin to manipulate award amounts and winners of federal contracts, defrauding the Air Force, General Services Administration (GSA), and companies competing for government contracts.
Paulsen, 56, was sentenced for one count of conspiracy, to five years of probation with six months home confinement and 100 hours of community service during each year of probation, the IRS said.
She was also ordered to pay just over $8 million in restitution to the government.
Essentially, the government charged David Joseph Bolduc — then a part-owner of Virginia software engineering firm QuantaDyn Corp. — with paying Seguin, 57, nearly $2.4 million in bribes so QuantaDyn could win contracts.
The San Antonio Express-News called the case the “largest military graft case” to come out of San Antonio in a decade.
The government alleged that Bolduc, of Herndon, Va., conspired with Paulsen, Hancock and Seguin to defraud the U.S. government by overcharging to offset bribe payments and inflate profits for the benefit of Bolduc, QuantaDyn, and the prime contractor that once employed Hancock and Paulsen, Booz Allen Hamilton.
QuantaDyn, based in Virginia, worked on training simulators for Joint Base San Antonio-Randolph in Texas.
This was a “scheme that spanned more than 10 years,” said the U.S. Attorney’s Office in the Western District of Texas.
Senior U.S. District Judge David Ezra sentenced Seguin to 36 months confinement with one year of supervised release for the charge of making a false income tax return, and 188 months confinement followed by three years of supervised release for the charge of conspiracy to commit wire fraud. The sentences will run concurrently.
The judge also ordered Seguin to pay $736,618 in restitution to the IRS and, $38.7 million in restitution to the Air Force, Army and General Services Administration, while forfeiting $2.3 million that he received in bribe money.
Seguin was sentenced in late April; Hancock and Paulson shortly thereafter.
“Government employees who collude with dishonest contractors to defraud the integrity of a government contracting system for personal gain will not be tolerated,” U.S. Attorney Jaime Esparza said in a statement released in late April. “It removes legitimate businesses from competition and harms the American taxpayer. It harms our nation’s warfighters by inflating the cost to the government, thereby reducing the materials and training available to our service members.”
In September 2020, the Department of Justice announced a settlement with QuantaDyn to resolve civil claims arising from allegations that it engaged in a bribery scheme to steer contracts to the company.
The company agreed to pay $37.8 million in restitution to resolve the company’s civil False Claims Act liability and fines totaling $6.3 million.
A message seeking comment was sent to the U.S. attorney’s office in San Antonio.
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