OAKLAND – Balvinder Singh Chadha pleaded guilty in federal court in Oakland, California, this week to committing wire fraud and conspiring to violate the federal conflict of interest statutes, United States Attorney MELINDA HAAG announced. His wife and co-defendant Jaspinder Kaur Chadha pleaded guilty earlier on March 28, 2012 to conspiring with Mr. Chadha.
In pleading guilty, Mr. Chadha, 45, of Union City, California, admitted that he was an investor in and served as the de facto head of a company called Golden Pacific Logistics, Inc. (“GPL”) while employed as Manager of Postal Vehicle Service Operations at a United States Postal Service (“USPS”) facility in Oakland, California. GPL was established for the purpose of obtaining truck leasing contracts with the USPS unit managed by Mr. Chadha. In July 2005, Mr. Chadha endorsed GPL during the procurement process for an USPS truck leasing contract that was ultimately awarded to GPL. Over the next four years, GPL billed USPS for trucks that were never leased, mileage that was never incurred, and servicing and maintenance costs that were never authorized under GPL’s contract. Using his USPS position, Mr. Chadha authorized payments to GPL and requested at least 18 modifications of the original contract, which extended the time period of the contract and increased the number of trucks authorized for leasing. All told, GPL billed and received $6,434,469.19, which included at least $4,432,156.82 in fraudulent billing.
Additionally, Mr. Chadha and Ms. Chadha admitted to conspiring to violate the federal conflict of interest statute, which prohibited Mr. Chadha, as an USPS employee, from willfully participating in a contract in which he and his wife had a financial interest. The Chadhas admitted that they engaged in a variety of measures to conceal Mr. Chadha’s association with GPL and create the appearance that Mr. Chadha and GPL were engaged in an arm’s length business relationship.
The United States Attorney charged the Chadhas in a two-count information filed on March 16, 2012. Count One charged him with committing wire fraud, in violation of 18 U.S.C. § 1343, and Count Two charged him and co-defendant Jaspinder Singh Chadha, 39, with conspiring to willfully violate the federal conflict of interest statute (18 U.S.C. §§ 208 and 216(a)(2)), in violation of 18 U.S.C. § 371. In addition, the information contains a forfeiture allegation against Mr. Chadha in relation to the wire fraud offense. Pursuant to their respective plea agreements, Mr. Chadha pled guilty to both counts and Ms. Chadha pled guilty to Count Two.
“As federal agencies, we have a responsibility to combat fraud and ensure taxpayers’ dollars are not being misspent,” said Clark Settles, special agent in charge for Homeland Security Investigations San Francisco. “These guilty pleas should send a message about the serious consequences facing those who seek to exploit their position for personal gain at the expense of the American people.”
Joanne Yarbrough, Special Agent in Charge for the Major Fraud Investigations Division of the United States Postal Service Office of Inspector General said, ”the vast majority of Postal Service employees and contractors are hard working professional individuals dedicated to the furtherance of Postal Service operations. However, when employees and contractors violate the public trust, as in this case, the Major Fraud Investigations Division will investigate those individuals aggressively and seek prosecution to the fullest extent of the law. The Major Fraud Investigations Division appreciates the US Attorney’s Office in the Northern District Of California for prosecuting the case and the assistance provided by the U.S. Immigration and Customs Enforcement in the investigation.”
Mr. Chadha and Ms. Chadha were both released on bond. Their sentencings are scheduled for July 11, 2012 before Judge Phyllis J. Hamilton in Oakland. The maximum statutory term of imprisonment for wire fraud, in violation of 18 U.S.C. § 1343, is 20 years and the maximum statutory term of imprisonment for conspiracy, in violation of 18 U.S.C. § 371, is 5 years. Additionally, each count has maximum statutory penalties of $250,000 or twice the gross pecuniary gain or twice the gross pecuniary loss, whichever is greater; 3 years of supervised release; $100 mandatory special assessment; and restitution. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Andrew S. Huang is the Assistant U.S. Attorney who is prosecuting the case with the assistance of legal assistants Vanessa Vargas and Jeanne Carstensen. Assistant U.S. Attorney Susan Gray also provided assistance with the investigation and prosecution of this case. The prosecution is the result of a multi-year joint investigation by the United States Postal Service Office of Inspector General’s Major Fraud Investigations Division and the Asset Identification and Removal Group of Homeland Security Investigations.