Tech firm head to plead guilty in Navy-contract bribery case

The president of a technology services company will plead guilty next week for bribing a public official with millions in funds from U.S. Navy contracts.

But the effort to determine the true extent of the kickback scheme - which could have far-reaching consequences for Navy contracting - doesn't end there.

The commander of Naval Sea Systems Command has appointed a team to review the way the command handles contracts and to recommend ways to lessen the risk of fraud. With 53,000 civilian and military personnel, NAVSEA engineers, builds, buys and maintains the Navy's ships and submarines and their combat systems.

The U.S. attorney in Rhode Island is continuing to investigate, along with agents from the Defense Criminal Services, Naval Criminal Investigative Service, Federal Bureau of Investigation and Internal Revenue Service.

Anjan Dutta-Gupta, 58, founder and president of Advanced Solutions for Tomorrow, agreed Monday to plead guilty in U.S. District Court in Providence to paying bribes to a civilian program manager and senior systems engineer with NAVSEA and to others, according to U.S. Attorney Peter F. Neronha. Advanced Solutions for Tomorrow had offices in Middletown, R.I., and Georgia.

According to court documents, Dutta-Gupta's company paid at least $8 million from 1996 to 2011, largely through subcontractors, to the co-defendant in the case, Ralph Mariano, 52, of NAVSEA, as well as to Mariano's family members, associates and an employee at Advanced Solutions for Tomorrow. In addition, at least $1.2 million was funneled to a corporation Dutta-Gupta owned, the documents say.

In exchange for the kickbacks, Mariano made sure that millions of dollars in additional funds were added to Advanced Solutions for Tomorrow's contracts and that the invoices were paid, the documents say.

Mariano worked at the Naval Undersea Warfare Center in Newport, R.I., a command within NAVSEA responsible for submarine warfare systems, and in Washington, D.C. The NUWC facility was in New London until it was ordered closed in 1995 and the work force transferred to Newport.

The documents laid the case out as follows:

Dutta-Gupta bought a company in 1996 that had a contract to provide technical services to the Navy. Shortly thereafter, Mariano contacted him to demand $6,000 per week or NAVSEA would stop paying the company.

Dutta-Gupta allowed Mariano to increase the hourly rate the Navy paid one of his employees, who in turn used the salary bump to pay Mariano, who continued to demand more money.

About three years later, Dutta-Gupta began making payments to Mariano through various companies that were supposed to serve as subcontractors to Advanced Solutions for Tomorrow on its Navy contracts. Russell Spencer, a Rhode Island resident, or his wife Debra, owned three of these subcontractors that received payments from Advanced Solutions for Tomorrow for "work that largely had not been performed," the documents say.

Spencer submitted inflated invoices to Advanced Solutions for Tomorrow, then paid Mariano, Mariano's father, brother, longtime girlfriend or associates. Spencer also paid a technical services company that Dutta-Gupta owned, according to the documents.

The payments totaled close to $30,000 a week by late 2010. Additionally, for the past four years, Spencer paid $3,500 to Mariano every other week in cash. Mariano also demanded that Dutta-Gupta fire certain employees and hire his friends instead at specified salaries, which Dutta-Gupta did.

U.S. Customs agents arrested Dutta-Gupta on Feb. 8 in Atlanta as he returned from Chile. He was released on a $25,000 bond and is scheduled to return to court April 28.

The Navy terminated all of its contracts with Advanced Solutions for Tomorrow shortly after Dutta-Gupta was charged. The company provided various engineering and technical services for submarine combat and command and control systems. Other contracts involved unmanned undersea vehicle capabilities and the design and development of combat systems architecture.

Electric Boat in Groton had no contracts with the company, according to a spokesman for the submarine manufacturer.

Once the review team has finished reviewing the contract processes at NAVSEA, a senior-level panel will discuss the findings and consider what actions to take, the Navy said Wednesday.

In exchange for Dutta-Gupta's guilty plea, the government will recommend a lesser sentence. The maximum penalty is 15 years in prison, fines and three years of supervised release. Dutta-Gupta, of Roswell, Ga., agreed to provide information to government representatives and to testify at future legal proceedings, including the grand jury.

Mariano, of Arlington, Va., has been charged with participating in the alleged kickback scheme and is awaiting trial. He remains free on a $50,000 bond.

j.mcdermott@theday.com