U.S. Attorney's Office for the District of Maryland issued the following announcement on Jan. 14.
U.S. District Judge Paul W. Grimm today sentenced Rakesh Kaushal, age 66, of Rockville, Maryland, to three years in federal prison, followed by three years of supervised release, for the federal charge of conspiracy to commit wire fraud, in connection with a scheme to defraud his employer of more than $1.7 million. Judge Grimm also ordered Kaushal to pay restitution with the exact amount to be determined at a later hearing.
The guilty plea was announced by United States Attorney for the District of Maryland Robert K. Hur and Special Agent in Charge Jennifer C. Boone of the Federal Bureau of Investigation, Baltimore Field Office.
According to his plea agreement, between August 2015 and approximately January 2017, Kaushal was employed by a company headquartered in Beltsville, Maryland (Victim Company 1), which provided construction and design services, primarily to federal government agencies. Ivan Victor Thrane was the owner and president of three construction companies operating in Dickerson and Beltsville, Maryland (“the Thrane companies”). Kaushal recommended the Thrane companies to be subcontractors on Victim Company 1 projects for which Kaushal was the Project Manager or Project Executive.
Kaushal admitted that between August 2015 and January 2017, he conspired with Thrane to defraud Victim Company 1 by submitting fraudulent payment requests for work purportedly performed by the Thrane companies, which Kaushal reviewed and approved. In fact, the Thrane companies had not performed all of the work indicated on the payment requests and, in some cases, had not performed any work on projects for which payment was requested.
Specifically, Kaushal and Thrane, among other things, caused the Thrane companies to submit payment requests to Victim Company 1. Kaushal prepared the payment requests, which he e-mailed to Thrane. Thrane, or another individual at Thrane’s request, signed the payment requests on behalf of the Thrane companies. Thrane then e-mailed the signed payment requests to Kaushal, who, as Victim Company 1’s project manager and project executive, approved the payment requests, causing Victim Company 1 to pay the Thrane companies. Once payment was received from Victim Company 1, Thrane funneled a portion of those payments to Kaushal, typically by writing checks from his personal bank account or from the Thrane companies, which Kaushal then deposited into his personal bank account.
After Victim Company 1 discovered the overbilling in December 2016, Kaushal and Thrane attempted to conceal the scheme to defraud. For example, on December 28, 2016, Kaushal, using his work e-mail address, sent an e-mail to Thrane that read in part, “Good Morning Mr. Thrane: I have been informed by our accounting department that mistakenly we have overpaid your company for the MPO Skywalk Project. Can you please verify with your accounting and respond by COB today.” Other employees from Victim Company 1 were copied on this e-mail. In fact, Kaushal and Thrane had communicated prior to this e-mail regarding the discovery of overpayments by Victim Company 1. Kaushal and Thrane also agreed on a response, which Thrane then e-mailed to Kaushal, copying other employees from Victim Company 1. Thrane’s response read in part, “…please allow me to review our records with my accountant. My accountant is off this week. . . . Please rest assured that if there have been any overpayment to us by [Victim Company 1], we will return the overpayment immediately.” In fact, the Thrane companies did not have an accountant.
Shortly after the fraud was discovered by Victim Company 1, between January 17 and January 23, 2017, Kaushal wired a total of $650,000, including proceeds of the fraud, from one of his personal bank accounts to an account in India, with Kaushal listed as the beneficiary.
Victim Company 1 eventually initiated civil litigation against Kaushal and Thrane, and obtained a default judgment against Kaushal of $1,740,330. Kaushal then filed for Chapter 7 bankruptcy. During a meeting of creditors in the bankruptcy proceeding, Kaushal testified that he had used some of the proceeds of the fraud to purchase a condominium in India for a family member and that he had lost more than $100,000 gambling at various casinos. Kaushal was unable to account for more than $1 million of the kickback payments he received from Thrane. On May 15, 2019, the Bankruptcy Court entered a default judgment against Kaushal, denying him a discharge.
From approximately September 2015 to December 2016, Victim Company 1 paid the Thrane companies approximately $3,294,675.34 as a result of the scheme to defraud. Upon receipt of these payments from Victim Company 1, Thrane issued 34 kickback payments, totaling approximately $1,740,330 in checks written to Kaushal. On January 3, 2017, after discovering the fraud scheme, Victim Company 1 reversed or voided payments totaling approximately $741,525 to the Thrane companies. Kaushal then provided Thrane with three checks, all dated January 4, 2017, from Kaushal and made payable to one of the Thrane companies, totaling $370,700.06. Kaushal admits that the loss attributable to him as a result of the scheme is between $1.5 million and $3.5 million.
Ivan Victor Thrane, age 65, of Dickerson, Maryland, pleaded guilty to his role in the scheme on August 22, 2019. Judge Grimm has not yet set a date for sentencing.
Kaushal remains detained.
United States Attorney Robert K. Hur commended the FBI for its work in the investigation. Mr. Hur thanked Assistant U.S. Attorneys Jessica Collins and Gregory Bernstein, who prosecuted the case.
Original source can be found here.