Virginia-based defense contractor pleads guilty to bribery conspiracy involving government contracts worth more than $100 million

Date: April 16, 2024

Contact: [email protected]

SAN DIEGO - Cambridge International Systems, Inc., a defense contractor headquartered in Arlington, Virginia, pleaded guilty in federal court today, admitting that it participated in a bribery scheme with the company's former Executive Vice President Russell Thurston, and former Naval Information Warfare Center employee James Soriano, among others.

According to Cambridge's plea agreement, the company - acting through Thurston and an unnamed employee - gave various things of value to Soriano, including jobs for Soriano's family and friends, meals, and a ticket to the 2018 MLB All Star Game held at Nationals Park in Washington D.C. One of the friends hired by Cambridge, Liberty Gutierrez, was giving Soriano $2,000 a month from her Cambridge salary, according to Gutierrez's plea agreement.

In return, Soriano, acting in his position as a contracting officer's representative at Naval Information Warfare Center ensured that Cambridge was awarded two large task orders. Soriano further ensured Cambridge was able to capture a steady stream of government funds by approving various projects on the task orders after they were awarded the contract, including more than 70 projects on one of the task orders. As a result of the conspiracy, the government obligated more than $32 million on one of the task orders and over $100 million on the other.

Soriano also allowed Cambridge employees to draft various procurement documents for him, even where the company was competing for the contract against other bidders. Thurston and Soriano worked together to remove document properties so other government employees would not know of Cambridge's involvement in drafting the documents.

Cambridge admitted that the company made a total profit of $7,429,995.23 as a result of the conspiracy. Cambridge is next scheduled to appear before U.S. District Judge Todd W. Robinson for sentencing on July 3, 2024.

"Service members depend on the honesty and integrity of our nation's defense contractors to be able to do their jobs," said U.S. Attorney Tara McGrath. "A business model based on fraud is both illegal and undermines the fairness of the system."

"Cambridge International Systems, Inc. demonstrated a culture of complicity in undermining the defense contracting process," said Special Agent in Charge Tyler Hatcher, IRS Criminal Investigation (CI), Los Angeles Field Office. "CI is committed to supporting investigations into activities that can harm national security, whether directly or indirectly, and to working with our law enforcement partners to ensure our warfighters are protected from this sort of corruption."

"The guilty plea of Cambridge International Systems, Inc. is a constructive step towards holding the company accountable for its active participation in an illegal scheme that corrupted the government's acquisition processes," said Bryan D. Denny, Special Agent in Charge of the Department of Defense Office of Inspector General, Defense Criminal Investigative Service, Western Field Office. "Such illicit actions ultimately waste invaluable U.S. taxpayer money and degrade American warfighter readiness."

"Bribery and procurement fraud within the Department of the Navy threatens warfighter safety and perpetuates unfair contracting practices that negatively affect honest businesses," said Special Agent in Charge Greg Gross of the NCIS Economic Crimes Field Office. "NCIS and our partners remain committed to exposing those who abuse the procurement process for personal gain."

CI is the criminal investigative arm of the IRS, responsible for conducting financial crime investigations, including tax fraud, narcotics trafficking, money-laundering, public corruption, healthcare fraud, identity theft and more. CI special agents are the only federal law enforcement agents with investigative jurisdiction over violations of the Internal Revenue Code, obtaining a more than a 90 percent federal conviction rate. The agency has 20 field offices located across the U.S. and 12 attaché posts abroad.

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