CDLU Provoked Probe: Ex-CEO of Balch & Bingham Client Charged With Afghan War Contract Fraud
Patience they told us. Patience.
CDLU’s letters, faxes, emails, phone calls, and meetings with the Office of the Special Counsel, the U.S. Department of Justice, and FBI since 2017 have finally paid off.
This late afternoon, the U.S. Department of Justice released this statement:
The former chief executive officer of a U.S. government contractor was charged today in connection with schemes to defraud the U.S. Department of Defense regarding contracts related to U.S. military efforts in Afghanistan.
Paul Daigle, 40, was charged with conspiracy, four counts of wire fraud, and four counts of false claims in an indictment filed today in the Northern District of Alabama. Daigle was the CEO of a company based in Huntsville, Alabama, which served as a subcontractor on U.S. Department of Defense aviation contracts related to the war in Afghanistan.
According to the indictment, between 2013 and 2017, Daigle allegedly engaged in two fraudulent schemes that resulted in the submission of false claims to the U.S. Government. The first scheme involved the use of unqualified employees for government contracts. Daigle allegedly mapped employees to labor categories on government contracts for which the employees did not meet minimum qualifications, resulting in the government overpaying for unqualified labor. To cover this up, Daigle allegedly directed employees to obtain false educational credentials and “fake degrees” from diploma mills on the internet. The second scheme involved alleged false billing, in which the government was charged for work unrelated to a government contract.
Late last year, we wrote an update about Black Hall Aerospace, a former Balch & Bingham client, that looked like was headed to extremely turbulent waters. We wrote at the time:
[We] learned from our sources that Black Hall Aerospace allegedly is still being probed by the U.S. Department of Justice.
Our sources told us that Black Hall Aerospace and Leidos have an ongoing financial dispute headed to state court [in 2020]
Could this dispute have been caused by a forensic audit or the alleged probes by the Office of the Inspector General of the U.S. Department of Defense and Military Criminal Investigations Command?
Our sources also confirmed that Paul Daigle, who has ownership in the aerospace company, has left as Chief Executive Officer; and that Oleg Sirbu, the Soviet-immigrant that wrangled with Daigle and others in an ugly civil-court fight to control Black Hall, has settled all civil matters and is living comfortably in Dubai.
On May 18, 2017, the day after Robert S. Mueller III was named Special Counsel of the U.S. Department of Justice, we, the CDLU, sent him a letter that included this about Black Hall Aerospace:
Enormous Revenue Growth Raises Questions
The revenue growth at the Russian-linked aerospace company has been enormous and raises serious concerns and questions. According to an online publication, the Russian-linked company, AAL USA, Inc. and/or Black Hall Aerospace, Inc., went from generating $6.5 million in 2014 with 15 employees, to over an estimated $100 million in 2016 with 450 employees. Likewise, according to a court filing on aviationintelligence.org, AAL USA Inc. had less than $1 million in revenue with fewer than 20 employees in 2014 but grew to over 400 employees and $50 million in revenue by 2016.
Something smells awful in this whole affair and we hope that you, Mr. Mueller, will take a deep and closer look.
The CDLU was also the first organization to raise questions about the qualifications of Black Hall employees writing in 2017:
One mechanic out of 400 employees? One of things Black Hall Aerospace boast is their FAA Part 145 Repair Station. But according to the government website, they have only one mechanic. Comparable companies have a half dozen to a dozen mechanics and numerous repairmen. Maybe the filing is old, but nonetheless, it raises further questions.
Three years and 6 months after we originally wrote to Mueller, the shoe finally dropped.
Now we hope, federal investigators will look at why Balch & Bingham scrubbed their website of any references to having successfully changed Russian sanctions on behalf of Black Hall Aerospace.
Balch & Bingham lobbyists trotted Paul Daigle office to office on Capitol Hill earning over $300,000 in fees from Black Hall Aerospace and its affiliates between 2014 and 2016.
