Advertisement

You will be redirected to the page you want to view in  seconds.

Couple accused in State Dept. contract scam wants evidence tossed

Jul. 9, 2013 - 05:48PM   |  
By JIM McELHATTON   |   Comments

An attorney for a former State Department contracting specialist accused of steering tens of millions of dollars in contracts wants a judge to toss evidence in the case partly because the woman never actually worked for the government.

The contracting specialist, Kathleen McGrade, 64, and her husband, Brian Collinsworth, 46, were indicted in April in U.S. District Court for the Eastern District of Virginia on conspiracy, fraud, false statements and other charges.

Prosecutors say through her job at the State Department, McGrade steered tens of millions of dollars in heating and ventilation work at embassies to the Sterling Royale Group, LLC, a company that she and her husband controlled, while hiding from colleagues the fact that she was married to Collinsworth.

But in a recent court filing, McGrade’s attorney argued evidence should be suppressed, in part, because she was employed by a private contracting company, not the federal government.

That’s a key distinction because the criminal conflict of interest law applies to government employees but doesn’t extend to a contract employee like McGrade, defense attorney Joseph McCarthy argued in a recent filing.

“The author of this affidavit confuses what might be an ethical flaw with a violation of law,” McCarthy argued, referring to a search warrant affidavit filed in the case.

“In sum, there is a bald accusation that defendant McGrade and defendant Collinsworth concealed the fact of their marriage from people with whom they worked while participating in multi-million dollar contracts,” the attorney wrote.

“Shocking as they may be on some level, these affidavits fail even to establish a crime, let alone those crimes enumerated in the applications for these search warrants.”

McGrade and Collinsworth pleaded not guilty May 3 to conspiracy, wire fraud and other felony charges, which carry penalties of up to 20 years in prison. They face trial in October.

Federal Times reported in May that the McGrade case exposed how as a contract employee, she was never required to fill out the same detailed ethics disclosures as federal employee counterparts, who must report on family relationships, assets, income sources and outside positions.

In court filings, prosecutors said McGrade “was involved in nearly every stage of the contracting process on the HVAC contract with SRG, including approving invoices, and attended nearly every meeting that involved SRG …”

Following searches of several properties, investigators uncovered what they said were proceeds from the multimillion-dollar contracting scam: a Steinway piano; sculptures; sapphire, emerald and diamond jewelry; and a 41-foot yacht.

In May, Arlington, Va.-based ATSG, where McGrade worked, confirmed to Federal Times that she had been fired, but added that while the contracting company monitored her hours and wrote her paychecks, McGrade reported to the State Department.

More In Acquisition