A former US Air Force sergeant has been found guilty of sending IT contracts worth millions of dollars from the military to himself, his family and friends. Alan Hayward James reportedly pleaded guilty to conspiracy to commit wire fraud, bribery and conspiracy to rig bids in Hawaii County.
According to a Justice Department statement issued Thursday, the 51-year-old was responsible for drafting contracts for US Air Force facilities across the Pacific.
The Texas native admitted he inflated the cost of materials and labor and then pocketed the difference, the Department of Justice revealed. James and his co-conspirators then funnel the money into shell companies, paying false salaries and benefits to people they call “The Godfather” and “The Godmother.” He kept track of excess money in ledgers, while referring to himself as “Al Capone” and his parents as “Capone M” and “Capone D.” He even paid his co-conspirators to enjoy an all-expenses-paid, two-night trip at a luxury resort on the north shore of Oahu, according to CBS News. Annual payments to his accounts ranged from $10,000 to $200,000. For example, he advised one company to bid for an IT contract that was “low and stupid,” which actually resulted in it winning the contract at an inflated rate.
Overall, he defrauded the Air Force out of a whopping $37 million over nine years, from 2016 to 2025. “Through this bid-rigging scheme, the defendant not only stole from American taxpayers and harmed companies seeking to compete fairly for government contracts, he also ultimately harmed essential military services designed to keep our nation safe by diverting resources away from other services,” U.S. Attorney Ken Sorenson for the District of Hawaii said in a statement.
“Bid rigging and anti-competitive behavior in government contracts erodes trust in our institutions, harms taxpayers, and will not be tolerated.”Sorenson warned that any and all individuals who seek to “manipulate markets and undermine fair competition for personal gain” will be investigated and prosecuted.The recipients did not include work required by the contracts, although they received “salaries” from the conspiring companies. Now, James faces 20 years in prison plus a $250,000 fine. Furthermore, he agreed to pay compensation of at least $1,451,656.80 to the US government, according to CBS News.
