Owner of Defense Contracting Firms Sentenced to 3 Years in Prison for Conspiracy to Defraud the Government
CAMDEN, N.J. – The owner of two defense contracting firms was sentenced to 36 months in prison for providing non-conforming parts for military equipment, illegally sharing sensitive technical information and evading income taxes, U.S. Attorney Craig Carpenito announced today.
Officials say Mr Roger Sobrado, 49, of Marlton, New Jersey, previously pleaded guilty before U.S. District Judge Noel L. Hillman to an information charging him with one count each of conspiracy to commit wire fraud, conspiracy to violate the Arms Export Control Act, and income tax evasion. Judge Hillman imposed the sentence on Sept. 4, 2019, in Camden federal court.
According to documents filed in this case and statements made in court:
Sobrado was the owner of two companies: Tico Manufacturing Inc. (TICO), a purported manufacturing company, and Military and Commercial Spares Inc. (MCS), a defense contracting company, both in Berlin Township, New Jersey.
Sobrado admitted that between January 2011 and December 2015, MCS obtained contracts with the U.S. Department of Defense (DoD) by falsely claiming that the military parts it contracted to provide would be exactly as described and provided by authorized manufacturers.
The DoD contracts specified that the parts were critical application items for military equipment, including fighter jets and helicopters. Sobrado recruited various family members to participate in the scheme by establishing companies that contracted with the DoD.
Those companies also obtained contracts with the DoD by falsely claiming that the military parts they contracted to provide would be the exact product described and would be provided by authorized manufacturers. In fact, Sobrado used TICO to contract with local manufacturers to supply non-conforming parts to MCS and his family members’ companies at a significantly reduced cost. The non-conforming parts supplied by Sobrado were shipped from New Jersey to various DoD locations around the country.
DoD paid Sobrado and his family members’ companies for the non-conforming parts. The family members then paid Sobrado for the non-conforming parts.
Sobrado admitted that he deposited some of his business receipts into his personal bank account and that he paid for personal items from his business account without telling his accountant.
For tax years 2011 through 2014, Sobrado reported a total taxable income of $1,608,372. He failed to report additional income of $1,182,405, which caused a loss to the United States of $509,962.
Sobrado also admitted that in August 2005 and in November 2010 he submitted to the DoD a fraudulent application for access to export controlled drawings and technical data on behalf of a family member’s company.
Sobrado acknowledged that access to the controlled drawings and technical data was limited to citizens of the United States and to those lawfully in the United States. Sobrado said he submitted the application because his family member told him that he needed access to drawings and that he could not get them because he was not a U.S. citizen.
Sobrado agreed that on July 28, 2011, and at various times between January 2013 and November 2015, the family member, who is illegally in the United States, accessed or downloaded hundreds of drawings that were sensitive in nature and that required special access.
In addition to the prison term, Judge Hillman sentenced Sobrado to three years of supervised release and ordered him to pay $8,043,977 in restitution.