The owner of a commercial flooring contractor in Fairbanks, Alaska has pleaded guilty to participating in a kickback scheme designed to defraud a U.S. Army facility. Benjamin W. McCulloch admitted to conspiring to pay kickbacks to an employee of a prime contractor in order to inflate the costs of flooring construction subcontracts at Fort Wainwright. Over the course of five years, McCulloch paid more than $100,000 in kickbacks, undermining competition for government contracts and wasting public funds intended for national defense. The charges carry a maximum penalty of ten years in prison and a fine of $250,000. Restitution will also be required.

Title: Owner of Commercial Flooring Contractor Pleads Guilty to Kickback Scheme

Heading 1: Background

Kickback schemes involve illegal arrangements in which one party pays or receives illicit payments in exchange for preferential treatment or financial gain. These schemes undermine fair competition and waste public funds meant for important endeavors, such as national defense. Recently, the owner of a commercial flooring company in Fairbanks, Alaska, pleaded guilty to participating in a kickback scheme that targeted a U.S. Army facility. This article provides a comprehensive overview of the case, including the charges, penalties, investigation details, and the joint law enforcement effort that was instrumental in bringing this perpetrator to justice.

Heading 2: Summary of the Case

Case Overview

The case revolves around Benjamin W. McCulloch, the owner of a commercial flooring company in Fairbanks, Alaska. McCulloch pleaded guilty to five-count felony charges on September 22, 2022, in the U.S. District Court for the District of Alaska. The charges stem from his role in a conspiracy to provide kickbacks related to contracts for commercial flooring services at a U.S. Army facility.

Plea Agreement

In his guilty plea, McCulloch admitted to conspiring to pay kickbacks to an employee of a prime contractor involved in flooring construction contracts administered by the U.S. Army at Fort Wainwright. The scheme lasted from March 2016 to March 2021 and involved inflating the costs of four flooring construction subcontracts. McCulloch then provided the proceeds from these inflated costs to his co-conspirator as kickbacks. Throughout the course of the five-year scheme, McCulloch paid over $100,000 in kickbacks.

Heading 2: Charges and Penalties

Kickback schemes are serious offenses that carry significant penalties. McCulloch faced multiple charges in relation to his participation in the scheme.

Charges

The five-count felony charges filed against McCulloch included:

  1. Conspiracy to commit anti-kickback offenses
  2. Three counts of submitting false claims
  3. Concealment of material facts

These charges demonstrate the gravity of McCulloch’s involvement in the kickback scheme and highlight the illegal activities he engaged in.

Penalties

If convicted on all charges, McCulloch would have faced a maximum penalty of ten years in prison and a fine of $250,000. In addition, the fine for the anti-kickback conspiracy charge could be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either amount exceeds the statutory maximum fine.

Heading 2: Investigation Details

Investigators Involved

Multiple law enforcement agencies collaborated in the investigation of this kickback scheme. These agencies included:

  1. Antitrust Division’s San Francisco Office
  2. U.S. Attorney’s Office for the District of Alaska
  3. FBI’s Anchorage Field Office
  4. U.S. Army Criminal Investigation Division’s Major Procurement Fraud Field Office
  5. Defense Criminal Investigative Service’s Western Field Office
  6. IRS’s Criminal-Investigation Seattle Office

The involvement of these agencies highlights the seriousness and complexity of the case, as well as the determination to bring the perpetrators to justice.

Joint Law Enforcement Effort

The investigation into this kickback scheme exemplifies the joint effort between law enforcement agencies to combat antitrust crimes and fraudulent schemes that impact government procurement at all levels. In November 2019, the Department of Justice established the Procurement Collusion Strike Force (PCSF) to tackle these issues. The PCSF brings together various law enforcement entities to detect, investigate, and disrupt schemes that undermine fair competition and waste public funds.

Prioritization of Kickback Schemes

Kickback schemes are a significant concern for law enforcement and government agencies. They distort fair competition, harm taxpayer interests, and erode public trust. As evident from this case, the joint law enforcement effort committed to dismantling such schemes reflects the seriousness with which these crimes are taken.

Heading 3: Jurisdiction of Investigation

The investigation into Benjamin W. McCulloch’s kickback scheme falls under the jurisdiction of the U.S. District Court for the District of Alaska. This court oversees criminal cases within its jurisdiction, ensuring that justice is served for the crimes committed.

Heading 3: Joint Law Enforcement Effort

The success of the investigation into this kickback scheme can be attributed to the collaborative efforts of multiple law enforcement agencies, both federal and local. Working together, these agencies pooled their resources and expertise to uncover the illegal activities, gather evidence, and build a strong case against the perpetrator.

Heading 2: Conclusion

The guilty plea of Benjamin W. McCulloch, owner of a commercial flooring contractor in Fairbanks, Alaska, to charges related to a kickback scheme targeting a U.S. Army facility, highlights the commitment of law enforcement agencies to combat illegal activities that undermine fair competition and waste public funds. This case serves as a reminder that those who engage in fraudulent schemes will be held accountable, and joint law enforcement efforts will continue to prioritize the investigation and prosecution of kickback schemes. The collaboration between various agencies demonstrates their determination to protect taxpayer interests, safeguard government procurement practices, and ensure that justice is served.

By Jesse Hull

I'm Jesse Hull, a retired Infantry Paratrooper and Outdoor Studies Major at Alaska Pacific University - and I am the mind behind Grimy Times - your portal to the darkest, grittiest news stories spanning the globe. With a tagline like "Grimiest News From Around The World!" you can expect no less. I bring you the most unearthed stories, guaranteeing authenticity without sugarcoating. From shadowy urban alleys to the most remote corners of our planet, my coverage knows no bounds.