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Cash, an SUV and TVs: Army contractor in Alaska pleads guilty to fraud

Editor’s note: This article was first published by the Alaska Beacon.

A Fairbanks man who defrauded the U.S. Government for a Ford Explorer, cash and other kickbacks agreed to a plea deal on Monday.

Kevin Mahler pleaded guilty for his part in a conspiracy to inflate project costs and take illegal payments on contracts for commercial flooring services at a U.S. Army facility in Fairbanks, Alaska. Over five years, he received more than $100,000 in kickbacks from the owner of a commercial flooring company, according to documents filed by federal prosecutors.

Mahler and flooring company owner Benjamin McCulloch inflated the costs of flooring subcontracts administered by Fort Wainwright. Then McCulloch paid roughly half the proceeds to Mahler. Between 2016 and 2021, Mahler received cash, a 1997 Ford Explorer, Apple watches, TVs, workout equipment, cash and an all-terrain vehicle from McCulloch. Mahler did not report this income to the Internal Revenue Service. McCulloch already pleaded guilty to his role in the crimes.

“Taking advantage of U.S. taxpayers by defrauding U.S. Army facilities is a crime and will not be tolerated,” said Deputy Assistant Attorney General Manish Kumar of the Justice Department’s Antitrust Division in a news release. “The Justice Department’s Procurement Collusion Strike Force will hold accountable individuals who conspire to illegally profit — through kickbacks or otherwise — at the expense of the public.”

Multiple agencies, including the Antitrust Division’s San Francisco office, the U.S. attorney’s office for Alaska, the FBI Anchorage field office, and the IRS Criminal Investigation’s Seattle office, are investigating the case.

Mahler could be sentenced to up to 10 years in prison and a fine of $250,000.

Read the full article here

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