-Caveat Lector-
October 19, 2002
Ex-officials accused of corruption
By Jerry Seper
THE WASHINGTON TIMES
Two former high-ranking Pentagon officials in the Clinton
administration were arrested yesterday on charges of extortion,
bribery, money-laundering and witness tampering in a suspected
scheme involving the awarding of contracts to minority firms.
U.S. Attorney Paul J. McNulty said Robert L. Neal Jr., 50, of
Bowie, and Francis D. Jones Jr., 40, of Fort Washington, are
accused of having used for "their own private enrichment" their
management positions at the Pentagon's Office of Small and
Disadvantaged Business Utilization (SADBU), a $28 million annual
program.
The suspected scheme, according to Mr. McNulty, netted the two
men more than $1.1 million in illicit profits.
"Those who hold public offices at high levels of the Pentagon
owe the highest duties of loyalty to the public and to our men and
women who have the distinction of serving in uniform," Mr. McNulty
said, adding that Mr. Neal and Mr. Jones "abused" their public
offices.
"They took advantage of the very disadvantaged business people
whose interests they were supposed to promote," he said. "Those
who have been granted the privilege of serving at the highest levels
of public office need to understand that if they betray the public trust
they will be prosecuted."
According to an affidavit unsealed by prosecutors yesterday, Mr.
Neal — a Clinton political appointee — served as SADBU director
from June 1996 until June 2001. Mr. Jones worked as his assistant.
Neither is now employed by the U.S. government.
Neither was available yesterday for comment.
SADBU is the office within the Defense Department chiefly
responsible for the development and promulgation of policies and
management initiatives designed to ensure that small businesses,
small disadvantaged businesses, women-owned small businesses,
historically black colleges and universities and minority institutions
were given an equal opportunity to compete for Defense
Department contracts.
The affidavit said Mr. Neal controlled a $28 million annual budget
and that he and Mr. Jones could substantially influence whether a
prospective minority bidder was accepted or denied. They also had
direct influence over contractors who sought to provide services and
materials to SADBU, the affidavit said.
According to the affidavit, Mr. Neal and Mr. Jones, both of whom
are black, engaged in a wide range of criminal activities during their
tenure at the Pentagon, using their positions as leverage to receive
illegal extortion payments, bribes and gratuities from minority or
disadvantaged Defense Department contractors seeking to
participate in the preference programs.
The affidavit said the two men "coordinated their illegal activities
and worked together as partners," conspiring with others in a
sophisticated scheme to launder the proceeds of their illegal
activities through phony companies, offshore bank accounts and
multilayered sham transactions.
It also said they conspired to embezzle more than $100,000 in
funds from federal programs.
A search yesterday by Defense Criminal Investigative Service
(DCIS) and FBI agents of houses belonging to Mr. Neal and Mr.
Jones uncovered $7,000 in cash from the Jones residence and gold
Rolex watches from both houses.
The affidavit said the watches were purchased for Mr. Neal and
Mr. Jones "by an individual whose company held contracts with
DOD over which Neal and Jones were in a position to exert
influence."
Mr. Neal was named to head SADBU on June 24, 1996. At the
time, he was the associate administrator for the Office of Enterprise
Development of the General Services Administration (GSA). At
GSA, his responsibilities also included the administration of
preference programs and conducting outreach to small, minority and
women-owned businesses to increase their participation in
government contracting.
He also served as an associate deputy administrator for
government contracting and minority enterprise development at the
Small Business Administration and held a number of positions at the
Office of Management and Budget (OMB). As a deputy associate
administrator with the Office of Federal Procurement Policy, he was
co-chairman for the OMB's regulatory efforts to implement the Drug-
free Workplace Act.
Mr. Neal has been awarded the Secretary of Defense's
Outstanding Public Service Medal and Outstanding Achievement
Award, the OMB's Special Performance Awards, OMB's EEO Award
and OMB's Divisional Awards for Special Performance.
Prosecution of the case is being handled by Assistant U.S.
Attorney Matthew Friedrich.
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