Indian American businessman admits to fraud

Friday, 09 January 2004, 20:30 IST
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WASHINGTON: An Indian American businessman has admitted that he overcharged the US Agency for International Development (USAID) by fraudulently claiming more than $850,000 for his contracts. Ajit S. Dutta, 59, pleaded guilty to obstructing a federal audit of his company, which had overcharged USAID, in the US District Court for the Eastern District of Virginia Thursday. Fairfax County, Virginia-based Dutta faces five years in prison and a $250,000 fine. He will be sentenced on March 26, says US attorney Paul J. McNulty. Assistant US attorney Stephen Learned handled the prosecution of Dutta's case, which was investigated by USAID's inspector general's office with help from the Defence Contract Audit Agency, according to a report in the Washington Times. Investigations in the Dutta case found that his firm engaged in illegal activities while providing administrative and logistical services for USAID, a federal agency that channels tax dollars to projects aligned with US foreign policy. Although his Falls Church based company, Datex, held about $71 million in contracts and grants with USAID, Dutta created inflated bills which he claimed for reimbursement by the federal agency. According to the prosecutors, Dutta showed on papers that his wife was a full time employee and paid her a salary while she was actually doing a full time job elsewhere. He also collected rent from Datex, ostensibly for his office in New Jersey, which was in fact, a second home for himself and his wife. Additionally, Dutta had Datex pay for nonexistent work by Dannix, his consulting company. Unaware that Dutta owned Dannix, federal auditors raised questions about a Datex consulting payment to the company in June 2001. Asked to verify the payment, Dutta gave a phoney list of trips and conferences by Dannix employees in such places as Singapore and India worth $35,000 in travel expenses. The payments were approved as reimbursable by agents who didn't know they were fake, the Times report said.
Source: IANS
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