U.S. Army Employee at Picattiny Arsenal Indicted for Conspiring to Defraud the United States, Engaging in Kickback Scheme, Traveling to Promote Bribery and Obstructing Justice
NEWARK, N.J. – A Pennsylvania man was charged today in connection with his role in two conspiracies in connection with construction projects at Picattiny Arsenal (PICA) and at the Joint Base McGuire-Dix Lakehurst (Ft. Dix) and for endeavoring to obstruct justice, Acting U.S. Attorney William E. Fitzpatrick announced.
Kevin Joseph Leondi, 57, was indicted by a federal grand jury in Newark on a charge of conspiring to defraud the United States in connection with his acceptance of repeated bribes given by other conspirators to influence Leondi to take official action for the benefit of his conspirators and their companies and to violate his duties as an employee of the U.S. Army. He is also charged with causing another to travel across state lines to facilitate a portion of this bribery scheme and with conspiring to steer kickbacks from one conspirator to another in connection with the award and administration of a prime contractor’s subcontracts.
Leondi had been charged in March 2017 with conspiring to defraud the United States through bribes and contactor kickbacks in connection with the conduct that now is charged in the indictment. He currently remains free on bail.
According to documents filed in this case and statements made in court:
Leondi was employed by the U.S. Army’s Contracting Command in New Jersey and represented the Army with respect to renovation projects at PICA and Ft. Dix. There was a construction company referred to as Construction Company No. 1 in the indictment, which served as a Job Order Contractor, also known as a “prime contractor,” for construction projects at PICA and Ft. Dix. James Conway was employed by Construction Company No. 1 as a regional project manager of large-scale construction projects at PICA and Ft. Dix. George Grassie ran a construction, excavation and landscaping business in Pennsylvania that did subcontracting work at the bases.
From December 2010 through August 2015, Leondi allegedly conspired with Conway and Grassie to accept more than $125,000 in bribes from them in return for task orders and other favorable assistance at the bases and in not denying them future work. The bribes included direct cash payments to Leondi (in one instance Conway traveled from New Jersey to Pennsylvania to pay Leondi $5,000 in cash). In some instances, Leondi and the conspirators would disguise the bribes in the form of facially legitimate transactions, with Leondi buying vehicles and equipment from the conspirators at cut-rate prices or selling them equipment at inflated prices. In another instance, Leondi had Grassie absorb the costs that another contractor incurred in renovating Leondi’s property in East Stroudsburg, Pennsylvania.
Leondi also allegedly conspired to steer at least $46,000 in corporate kickbacks from Grassie to Conway to improperly obtain and reward Conway for his giving subcontracts and other favorable assistance to Grassie relating to Conway’s employer’s contracts with the federal government at PICA and Fort Dix.
As alleged in the indictment, Leondi also endeavored to obstruct the federal grand jury investigation by submitting a false document to federal authorities in response to a federal grand jury subpoena in order to conceal part of his bribe-taking involving Grassie.
Grassie pleaded guilty to one count of conspiracy and one count of providing unlawful kickbacks in February 2017 for his role in the bribery and kickback conspiracies. Conway pleaded guilty to accepting unlawful kickbacks and a wire fraud charge involving other fraudulent conduct in August 2016. Both cases are pending before U.S. District Judge Susan D. Wigenton.
The conspiracy charges and the travel in aid of bribery charge each carry a maximum penalty of five years in prison; the obstruction of justice charge carries a maximum penalty of 10 years in prison. Each charge carries a maximum $250,000 fine.
Acting U.S. Attorney Fitzpatrick credited special agents with the FBI, under the direction of Special Agent in Charge Timothy Gallagher; the U.S. Department of Defense, Defense Criminal Investigative Service, under the direction Special Agent in Charge Leigh-Alistair Barzey, Northeast Field Office; and the U.S. Army, Major Procurement Fraud Unit, Criminal Investigation Command, under the direction of Special Agent in Charge Larry Scott Moreland.
The government is represented by Senior Litigation Counsel Leslie Faye Schwartz, of the U.S. Attorney’s Office’s Special Prosecutions Division and Assistant U.S. Attorney Barbara Llanes, Chief of the General Crimes Unit, in Newark.