Navy Contracting Officer Accepted more than $1.2 in Bribes

A senior procurement official for the Navy has plead guilty to accepting more than $1.2 million in bribes over a ten-year period.

The Navy civilian (Mr. Barroso) held his trusted position as a Master Scheduler for 22 years. A Master Scheduler is an approving official responsible for approving material purchases, service contracts, vendors and payments to vendors. Allowing a single person to fulfill all of those responsibilities is a major (and obvious) internal control deficiency that the Navy should have been cognizant of and have adjusted its policies, procedures, and practices long ago.

Beginning in 2008, this employee conspired with Bauer, a Ventura County businessman who operated three entities that received Navy contracts. The two entered into an arrangement in which Barroso would issue and approve work orders and purchase orders to Bauer's companies. Bauer then submitted false invoices from his companies and then Barroso would approve those invoices and Bauer would receive payment. A nice tidy package - Barroso issued contracts and approved payment for services under those contracts. The trouble is, no work was ever performed.

Barroso's kickbacks amounted to 50 percent of the false invoices. Prior to 2011, kickbacks were paid in cash. After 2011, kickbacks were paid to a company that Barroso set up for the purpose of collecting bribes. Government investigators were able to identify $1.2 million in kickbacks. Obviously there could have been more. In addition to the kickback charges, Barroso also admitted to income tax violations.

Barroso's sentencing is scheduled for June. Last November, Bauer plead guilty for his part in the conspiracy and will be sentenced in June as well. You can read the Justice Department's press release on this matter here.

The Justice Department did not disclose how the fraud was uncovered. It probably was not a whistleblower. The Justice Department usually discloses fraud uncovered by whistleblowers. Perhaps it was just someone in the Navy finance office wondering what services the Navy was getting for all those payments.

UPDATE: On July 15th, 2019, Mr. Barroso was sentenced to 70 months in federal prison.