Vet Contractor Milks Military for $1M+

⏱ 2 min read

Donald Smith, 75, a Pittsburgh contractor, is staring down serious time after a federal jury convicted him of ripping off the U.S. military for over a million bucks. The scheme, carried out through his defense contracting business, involved billing the Defense Logistics Agency (DLA) for goods that were either junk or never showed up at all. The verdict came after a five-day trial and includes charges for stiffing the IRS to boot.

Prosecutors laid out how Smith’s company systematically collected payments from 2019 to 2023 on contracts he never fulfilled, or delivered substandard products to the DLA, the agency responsible for supplying everything to every branch of the armed forces. Then, he didn’t report a single dime of the stolen money to the IRS. A double dip of greed, plain and simple.

Smith was found guilty on 13 counts of wire fraud, each carrying a potential 20-year sentence and significant fines. Add to that a year in prison per count for failing to file corporate tax returns, plus more fines. Sentencing hasn’t been scheduled yet, but feds are clearly aiming for a lengthy prison term given the scope of the fraud.

The investigation was a coordinated effort by the Defense Criminal Investigative Service, IRS-Criminal Investigation, and the Naval Criminal Investigative Service – a trifecta of federal agencies bringing Smith to justice. Assistant U.S. Attorneys William Guappone and Barbara K. Doolittle handled the prosecution.