3 convicted in multi-million dollar scheme to defraud United States

Jury convicts trio with multiple fraud counts


A federal jury has convicted three people for their roles in a multi-million dollar fraud scheme, authorities announced Thursday.

Jurors convicted Donald Dean Brewer, 62, and his wife, Sherri Lynn Brewer, 62, and 60-year-old James McKinney with one count of conspiracy to defraud the United States, twelve counts of wire fraud and three counts of major fraud against the United States.

According to testimony at trial, Donald Brewer was employed by KARTA Technologies, Inc. in 2002, as the Medical Systems Infrastructure Modernization program manager at Brooks City-Base.

McKinney served as V.P. of Government Services for Ark Systems, Inc.

Authorities said KARTA contracted with the Air Force to provide engineers and analysts to evaluate and implement MSIM projects for the Air Force.

Ark was hired by various Government contractors to provide the installation of cabling and electronics in support of MSIM projects at Air Force medical facilities worldwide, according to the release.

Testimony revealed that the three created a sham subcontracting business, Enterprise and Deployment, LLC to be included as an additional extra subcontractor between the prime contractors and Ark.

E&D added no value to these contracts, but the three submitted invoices for payment to E&D invoices, causing prime contractors to overcharge the Air Force by including E&D's fraudulent charges in the prime contractor invoices.

From July 2002 through 2008, authorities said the three carried out their scheme, obtaining approximately $33.5 million in subcontracts for E&D and thereby enriching themselves by almost $6.5 million.

The conspiracy charge carries a statutory maximum penalty of five years in federal prison; each wire fraud charge up to 20 years in federal prison; and, each major fraud charge up to 10 years in federal prison.

A monetary judgment against the defendants for more than $6 million is also pending before the Court.

Donald Brewer, Sherri Brewer and McKinney remain free on bond pending sentencing, scheduled for June 28, 2013 before Chief U.S. District Judge Fred Biery.