Manhattan U.S. Attorney Announces Charges Against Two Individuals In Connection With Bribery And Kickback Scheme To Secure Business From A Nonprofit Health Organization
Preet Bharara, the United States Attorney for the Southern District of New York, and Philip R. Bartlett, Inspector-in-Charge of the New York Office of the U.S. Postal Inspection Service (“USPIS”), announced the unsealing of charges today against NIMESH PATEL, a former information technology employee at a large national nonprofit organization (the “Society”) and DILIP VADLAMUDI, the owner of an information technology outsourcing company located in Indiana, for engaging in a bribery and kickback scheme. PATEL was arrested this morning in New Jersey, and was presented today before United States Magistrate Judge Katharine H. Parker. VADLAMUDI was arrested this morning in Indiana, and was expected to be presented US v. Patel and Vadlamudi indictment.pdftoday before a Magistrate Judge in Indianapolis.
U.S. Attorney Preet Bharara said: “As alleged, the defendants conspired to defraud a national nonprofit organization. Patel allegedly abused his position at the nonprofit to funnel millions in fees to Vadlamudi’s company in exchange for hundreds of thousands in kickbacks. Thanks to the investigative work of the U.S. Postal Inspection Service, the defendants’ alleged fraud scheme has been put to an end.”
USPIS Inspector-in-Charge Philip R. Bartlett said: “These individuals took advantage of their business relationship by devising a scheme to ‘fatten their wallets,’ while having no regard for the victimized nonprofit organization. Postal Inspectors will always be on the forefront of bringing criminals to justice for their greedy misdeeds against the American public.”
As alleged in the Indictment unsealed today in Manhattan federal court:
The Society is a large nonprofit health care organization with national headquarters in Westchester, New York. PATEL was employed as a senior director in the information technology group at the Society. During the time PATEL worked at the Society, he signed acknowledgements of its conflict-of-interest policy, which prohibited employees from soliciting or accepting payments from any individual or organization that had business with the Society. VADLAMUDI owned a company headquartered in Indiana (“VADLAMUDI Company-1”) that, among other things, acted as a temporary staffing company for information technology (“IT”) professionals. VADLAMUDI Company-1 had a contract with the Society pursuant to which Society employees, including PATEL, were authorized to hire temporary employees on behalf of the Society from VADLAMUDI Company-1.
From in or about October 2012 through in or about September 2014, PATEL hired numerous temporary IT employees from VADLAMUDI Company-1, which caused the Society to pay VADLAMUDI Company-1 millions of dollars in fees. During that same time period, VADLAMUDI paid PATEL approximately $274,000 in kickbacks. PATEL and VADLAMUDI exchanged emails regarding this kickback scheme. For instance, on a regular basis PATEL and VADLAMUDI exchanged spreadsheets listing the names of VADLAMUDI Company-1 temporary IT employees hired by the Society, along with a kickback amount calculated per employee.
In order to make payments to PATEL, VADLAMUDI used a bank account associated with a different company he controlled to transfer approximately $274,000 to the bank account for a shell corporation set up by PATEL. PATEL used that money for his personal expenses, including $80,000 toward a down payment on his residence and over $100,000 transferred into his personal bank account.
When the Society conducted an investigation into allegations of bribery and kickbacks in the IT department in the fall of 2014, PATEL falsely denied receiving money from VADLAMUDI.
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PATEL, 45, of Woodcliff Lake, New Jersey, and VADLAMUDI, 45, of Carmel, Indiana, are both charged in three counts: one count of conspiracy to commit honest services wire fraud; one count of conspiring to violate the Travel Act; and one count of conspiring to commit money laundering. Counts One and Three each carry a maximum sentence of 20 years in prison. Count Two carries a maximum sentence of five years in prison. The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by the judge.
Mr. Bharara praised the work of the USPIS.
This case is being prosecuted by the Office’s Complex Frauds and Cybercrime Unit. Assistant U.S. Attorney Richard Cooper is in charge of the prosecution.
The allegations contained in the Indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
 As the introductory phrase signifies, the entirety of the text of the Indictment, and the description of the Indictment set forth herein, constitute only allegations, and every fact described should be treated as an allegation.