Ralph Mariano Pleads Guilty To Multimillion-Dollar Kickback Scheme

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RALPH MARIANO PLEADS GUILTY
Ralph Mariano Jr., walks up the steps into Federal Court, Monday, July 9, 2012, in Providence, R.I., where he faces charges on tax evasion in U.S. District Court in connection with a kickback case that prosecutors say cost the U.S. Navy $10 million. (AP Photo/Stephan Savoia) | AP

PROVIDENCE, R.I. — A former U.S. Navy civilian employee will change his plea to guilty and admit he orchestrated a kickback scheme in which government contractors funneled millions of dollars back to him and others.

In a plea agreement filed in U.S. District Court in Providence on Wednesday, Ralph M. Mariano, 55, of South Arlington, Va., said he will plead guilty to conspiracy, theft of government property and tax evasion. The agreement says the government lost $7 million to $20 million from his part in the scheme, which prosecutors say lasted 15 years, until 2011, when Mariano was arrested.

Six people have been charged in the scheme, and four have already pleaded guilty. Mariano's girlfriend, Mary O'Rourke, 49, an executive at a contractor involved in the scheme, said on Tuesday she would also plead guilty to a charge of theft of government property.

Mariano and O'Rourke were scheduled to change their pleas to guilty in federal court on Thursday.

Mariano was a Navy employee for more than 38 years. Prosecutors say that in his job as a civilian engineer at the Naval Undersea Warfare Center he could authorize or refuse payments to contractors. They say he used that power to approve payments to Georgia-based contractor Advanced Solutions for Tomorrow, or ASFT. In return, prosecutors say, the now-defunct contractor, which also had an office in Middletown, R.I., funneled kickbacks to him and others.

The four men who have pleaded guilty are ASFT's founder, Anjan Dutta-Gupta, of Roswell, Ga.; former ASFT executive Patrick Nagle, of Marietta, Ga.; ASFT subcontractor Russell Spencer, who has said he acted as a middleman; and Mariano's father, Ralph Mariano Jr., who prosecutors say received more than $2 million from the scheme. None of them has been sentenced.

While the criminal case could be drawing to close, there is still a pending federal whistle-blower lawsuit that makes allegations about similar illegal conduct against the younger Mariano, Dutta-Gupta, ASFT and others. The 2006 complaint, first filed under seal in Georgia and then transferred to federal court in Rhode Island and unsealed, was made under a rule that allows private citizens to sue on the government's behalf.

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