Criminal Investigations

ALEXANDRIA, Va. – Anthony R. Bilby, 40, of Leesburg, Va., pleaded guilty today to conspiracy to commit wire fraud and major government fraud.

Dana J. Boente, Acting United States Attorney for the Eastern District of Virginia; Charles K. Edwards, Deputy Inspector General for the Department of Homeland Security (DHS); Brian D. Miller, General Services Administration (GSA) Inspector General; Peggy E. Gustafson, Small Business Administration (SBA) Inspector General; and Kim Lampkins, Special Agent in Charge, Department of Veterans Affairs (VA), Office of Inspector General, made the announcement after the plea was accepted by United States District Judge Anthony J. Trenga.

Bilby faces a maximum penalty of five years in prison when he is sentenced on February 21, 2014.  He has agreed to forfeit $1,065,103.90, representing his personal proceeds from the conspiracy.

In a statement of facts filed with the plea agreement, Bilby admitted that from April 2007 through November 2012, while he was employed by two service-disabled veteran-owned small businesses, he participated in a conspiracy to obtain government contracts through fraud and misrepresentation.  During this time period, Bilby caused employees at a nominal competitor to submit inflated bids on the same procurements for which Bilby submitted bids on behalf of his employers.  Bilby also gained improper access to the procurement process through co-conspirators working within the government.  These co-conspirators provided Bilby and others with internal government cost estimates, so that Bilby knew how much the government was willing to pay before he drafted his and his competitor’s bids.  Bilby also drafted portions of internal procurement documents in a manner that increased his odds of winning contracts without facing actual competition.

One of Bilby’s employers, with Bilby’s knowledge and assent, agreed to pay ten percent of its profits on a contract worth more than $24 million to co-conspirators within the government.  These co-conspirators, in turn, provided Bilby and his employer with improper access to documents and a competitive advantage in obtaining the contract.  In total, the conduct of Bilby and others resulted in the award of more than $33 million in federal contracts through fraudulent procurement practices.

As part of his plea agreement, Bilby has agreed to cooperate in the investigation of others involved in the conspiracy.  Another co-conspirator, Thomas S. Flynn, pleaded guilty on October 2, 2013.

This case was investigated by the Offices of the Inspector General for DHS, GSA, SBA, and the VA, with assistance from DHS’s Office of the Chief Security Officer, Cyber Forensic Branch.  Assistant United States Attorney Kosta S. Stojilkovic is prosecuting the case on behalf of the United States.

A copy of this press release may be found on the website of the United States Attorney’s Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae.  Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov/ or on https://pcl.uscourts.gov/.

ATLANTA – John A. Wheeler and Melody Lockett Carter pleaded guilty in federal court to fraudulently obtaining FEMA assistance funds intended for the victims of Hurricane Ike.

“These defendants stole over $50,000 in disaster relief funds that were intended to benefit those who truly suffered from the devastation of Hurricane Ike in 2008,” said United States Attorney Sally Quillian Yates.  “Since the creation of the Disaster Fraud Task Force in 2005, we have remained committed to prosecuting those criminals who would take advantage of natural disasters to enrich themselves.”

James E. Ward, Special Agent in Charge for the U. S. Department of Homeland Security, Office of the Inspector General, said, “The Department of Homeland Security, Office of Inspector General is dedicated to investigating fraud related to DHS programs, specifically FEMA Emergency Disaster Relief Funds.  The charges against these defendants serves as an example of our commitment to investigating FEMA fraud allegations and pursuing federal prosecution to the fullest extent of the law.  DHS-OIG will continue to place a high priority on investigating these types of crimes which negatively impact FEMA’s Disaster Relief Funds that are intended for law abiding citizens.”

According to United States Attorney Yates, the charges and other information presented in court:  Wheeler, 57, and Carter, 49, both of Wilmerding, Pa., and Angela Pratt Avery, 44, of Lawrenceville, Ga., worked together to file three fraudulent FEMA claims for Hurricane Ike disaster relief funds.  The defendants filed the claims in September 2008 and January 2009, falsely claiming that Carter and Avery lived at a West Ventura Drive address in Galveston, Texas, at the time of Hurricane Ike and that their

personal property had been damaged by the storm.  In fact, all three defendants lived in Norcross, Ga., at the time of Hurricane Ike and were not victims of the storm.  The defendants received over $50,000 in disaster assistance from FEMA based on their fraud.

On September 13, 2008, Hurricane Ike made landfall near Galveston, causing widespread damage along the Texas, Louisiana, Mississippi, and Florida coastlines and the surrounding areas.  After Hurricane Ike struck the Texas coastline, FEMA provided financial disaster assistance to displaced individuals who resided in various counties in Texas.  Those individuals could make an application for disaster assistance funds by filing a claim with FEMA that included the Texas address where they were living at the time of the hurricane.

Wheeler and Carter each pleaded guilty to one count of theft of government money.  Sentencing for Wheeler and Carter will be scheduled at a later date.

This case is being investigated by Special Agents of the U.S. Department of Homeland Security, Office of Inspector General.

Assistant United States Attorney Stephen H. McClain is prosecuting the case.

In September 2005, the Attorney General established the Disaster Fraud Task Force to deter, detect, and prosecute disaster-related federal crimes such as charity fraud, identity theft, procurement fraud, and insurance fraud related to the Hurricane Katrina disaster.  As multiple disasters occurred in subsequent years, the Task Force expanded its mandate to all types of disaster fraud.  The Task Force, chaired by Acting Assistant Attorney General Mythili Raman of the Criminal Division, includes the FBI, the Postal Inspection Service, the U.S. Secret Service, the Federal Trade Commission, the Securities and Exchange Commission, federal Inspectors General, and various representatives of state and local law enforcement.

For further information please contact the U.S. Attorney’s Public Affairs Office at USAGAN.PressEmails@usdoj.gov (link sends e-mail) or (404) 581-6016.  The Internet address for the home page for the U.S. Attorney’s Office for the Northern District of Georgia Atlanta Division is http://www.justice.gov/usao/gan/.