- The Washington Times - Saturday, February 15, 2003

A California man and his wife pleaded guilty yesterday in federal court in Alexandria in a $1.3 million kickback scheme involving the payment of illegal gratuities to building managers at TRW Inc., a major U.S. defense contractor.
Michael A. Edwards and his wife, Lisa, both 32, of Garden Grove, Calif., pleaded guilty to one count of knowingly engaging in misleading conduct with the intent to prevent or hinder the communication of information to a law enforcement officer concerning a federal crime, U.S. Attorney Paul J. McNulty said.
Both face sentences of 10 years in prison and fines totaling $250,000. Sentencing is set for May 16 before U.S. District Chief Judge Claude M. Hilton.
Mr. McNulty said an FBI investigation, which began in October 2000, focused on accusations that general contractors were violating the federal Anti-Kickback Statute by paying kickbacks or gratuities to TRW building managers as a reward for performing work for the defense contractor.
At the time, TRW was contracted to do work for the National Reconnaissance Office (NRO) in Chantilly.
Mr. McNulty said Michael Edwards and his brother, Timothy, were both TRW building managers at TRW's Redondo Beach, Calif., offices who had discretion to hire Bob Parrett Construction Co. as a general contractor. He said FBI agents interviewed Timothy Edwards in October 2000 about gratuities received by TRW building managers from Parrett Construction.
Alerted by Timothy Edwards of the FBI investigation, Mr. McNulty said Michael and Lisa Edwards engaged in a scheme to cover up the fact that Michael Edwards, in violation of TRW policy, had received from a Parrett Construction employee substantial gratuities in the form of home improvements and furniture.
He said the Edwardses created five bogus receipts purporting to show they had paid the Parrett Construction employee $26,462 in cash for the home improvements and furniture.
In February 2002, when investigators focused on Michael Edwards, Mr. McNulty said the couple delivered the phony receipts to a Long Beach FBI agent, who forwarded them to Alexandria, where a grand jury investigation was under way.
Six weeks later, in a further effort to obstruct the investigation, Mr. McNulty said Lisa Edwards, in an interview with the Long Beach FBI agent, insisted that the receipts were genuine and that cash payments were made to the Parrett Construction employee.
On Jan. 21, Timothy Edwards pleaded guilty to one count of obstruction of justice for his role in the coverup.
On Sept. 18, Marco Urrea, a Parrett Construction employee, had pleaded guilty to conspiring to defraud the United States for his role in the kickback scheme.
On Oct. 23, Jeffrey Bochesa, part owner and day-to-day manager of Parrett Construction, also had pleaded guilty to conspiring to defraud the United States.
Bochesa admitted approving the payment of gratuities or kickbacks to TRW building managers and agreeing to overcharge TRW approximately $1.3 million over five years.
Mr. McNulty said 94 percent of those overcharges were passed on to the NRO.
The investigation was conducted by special agents of the FBI, Defense Criminal Investigative Service, and the Office of the Inspector General of the National Reconnaissance Office.
The case was prosecuted by Assistant U.S. Attorney Stephen Learned.

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