Defense Firm, Ex-Chief Agree to Plead Guilty
A subsidiary of San Diego-based Cubic Corp. and its former chief executive Tuesday pleaded guilty to conspiring to bribe a Pentagon official in an attempt to win Defense Department contracts.
The guilty pleas ended the government’s investigation into Cubic’s role in the ongoing Ill Wind investigation.
Cubic Defense Systems, which pleaded guilty to three felony counts of conspiracy, theft of government property and filing false statements, agreed to pay $4.6 million in civil and criminal fines and penalties as part of a negotiated settlement entered in U.S. District Court in Alexandria, Va.
In a separate settlement, former Cubic Defense Systems President C. C. (Sam) Wellborn pleaded guilty to giving money to a Washington-based consultant who used the funds to obtain sensitive Defense Department documents from a top Pentagon official. Wellborn, who resigned from Cubic in 1989, was the only Cubic employee charged in the Ill Wind probe.
Wellborn, who faces up to 15 years in prison and a $500,000 fine, agreed to cooperate with federal authorities in the continuing investigation, Assistant U.S. Atty. Joseph J. Aronica said Tuesday.
The defense procurement investigation drew wide attention during the summer of 1988, when agents from the Naval Investigative Service and the FBI searched the offices of dozens of defense industry executives, consultants and government officials.
Cubic’s Defense Systems subsidiary was the fifth contractor to plead guilty in the Ill Wind probe, which has generated 42 convictions and recovered more than $40 million in fines and penalties.
Tuesday’s negotiated court settlement does not prohibit Cubic from seeking future Defense Department contracts, but Cubic now faces a review by the Defense Department, which regularly investigates companies found guilty of criminal activity.
