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Federal Contractor Misconduct Database (FCMD)

The federal government routinely awards contracts to companies with histories of misconduct, including contract fraud and other violations. POGO believes that providing this website will help to improve contracting decisions and increase public knowledge of how the government spends billions of taxpayer dollars each year. Read more…

Illicit Payments to Secure an Egyptian Air Force Contract

The Securities and Exchange Commission settled an enforcement action against Thomas Wurzel, the former President of ACL Technologies, Inc., a former subsidiary of United Industrial Corporation (UIC). The government alleged that Wurzel, in violation of the Foreign Corrupt Practices Act (FCPA), authorized illicit payments to an Egyptian-based agent in 2001 to 2002 for the purpose of influencing Egyptian Air Force officials to award his company a $5.3 million contract to build a military aircraft depot in Cairo. According to the SEC’s complaint, Wurzel authorized three forms of illicit payments to the agent and directed his subordinates to create false invoices to conceal one of those payments. Without admitting or denying the allegations in the complaint, Wurzel consented to the entry of a final judgment ordering him to pay a $35,000 civil penalty. The SEC also settled an administrative proceeding against UIC in the same matter. According to the SEC, “UIC lacked meaningful controls to prevent or detect the ACL President’s authorization of illicit payments to the agent. The UIC legal department approved the retention of the agent despite a lack of documented due diligence and the failure of the agency agreement to comply with corporate policy. Moreover, a UIC official approved at least one payment to the agent, and the illicit payments to the agent were mischaracterized on UIC’s books and records as legitimate business expenses.” Without admitting or denying the SEC’s findings, UIC agreed to pay $337,679 in disgorgement and prejudgment interest.

Misconduct Type
Ethics
Enforcement Agency
SEC
Contracting Party
None
Court Type
Civil
Disposition
Settlement
Date of Settlement
5/29/2009
Contractors Involved Penalty
Total
United Industrial Corporation $372,679
Further Information Released
Complaint (Wurzel) 6/4/2009
Order (UIC) 6/4/2009
SEC Press Release 6/4/2009

Federal Contractor Misconduct Database