updated 2/8/2011 5:26:06 PM ET 2011-02-08T22:26:06

A civilian Navy employee and the founder of a Georgia-based technology services company with more than $120 million in Navy contracts have been charged in a $10 million kickback and bribery scheme, federal prosecutors announced Tuesday.

The scheme dates back more than 10 years and involved bogus and inflated invoices and work that was paid for but never performed, prosecutors said.

Anjan Dutta-Gupta, 58, of Roswell, Ga., and Ralph M. Mariano, 52, of Arlington, Va., are charged in a criminal complaint with bribery of a public official. They were both released on bond following court appearances Monday.

Dutta-Gupta is founder and president of Georgia-based Advanced Solutions for Tomorrow, or ASFT, which has an office in Middletown and more than $120 million worth of Navy contracts. Mariano is a civilian program manager and senior systems engineer for the Naval Sea Systems Command, which prosecutors say accounts for nearly one-fourth of the Navy's entire budget and has a force of 53,000 civilian, military and contract support personnel.

Prosecutors say Dutta-Gupta funneled about $10 million through his company's subcontractors to Mariano and his relatives, including his brother, father and girlfriend, and other associates in return for Navy funding on ASFT contracts. They allege that Mariano, who controls funding for NAVSEA's technical programs, abused his authority by adding money to existing ASFT contracts with the Navy, or delivery orders, for work that was never done.

Investigation continues
No one else was charged, but prosecutors say the investigation is continuing.

ASFT sent roughly $13.5 million in Navy funding to one of its subcontractors, C&S Technology Inc., which since 1999 has paid $8 million to Mariano and his relatives and directed back $2 million to entities controlled by Dutta-Gupta, according to an affidavit written by Patrick J. Hegarty, a criminal investigator with the U.S. Defense Department. The payments to Mariano often came before his trips to Las Vegas or other vacations, Hegarty said.

"I have found no evidence to support a legitimate purpose for the payments to Mariano, and the majority of the payments to Mariano's relatives and associates and to Dutta-Gupta's entities were for services not performed," Hegarty wrote.

A phone message left with C&S Technology was not immediately returned, but court papers indicate the founder and owner of the company — who was not named in the affidavit — cooperated with the investigation and provided information about the alleged scheme.

"The public has the right to know that the people who work for them do so honestly. Taxpayer money should never be wasted, let alone stolen, as is alleged here," said Peter Neronha, the U.S. attorney for Rhode Island.

Generous RI donor
Dutta-Gupta is a generous donor to Rhode Island's Democratic congressional delegation, and his company's website shows him standing next to then-House Speaker Nancy Pelosi and former Rep. Patrick Kennedy at an event he held at his company in 2009. Sen. Jack Reed, a Rhode Island Democrat and member of the Senate Appropriations Committee, has previously helped earmark military funding for ASFT.

"These allegations are very serious and upsetting. Thousands of Rhode Islanders work in the defense industry. They are an essential part of our state's economy, but theft and corruption must not be tolerated, and I am pleased that law enforcement officials and the U.S. Attorney are aggressively pursuing this case," Reed said in a statement.

Dutta-Gupta was arrested Sunday as he returned to Atlanta from a trip to Chile. He was released on $25,000 bond and is due next week in federal court in Rhode Island. A phone message left for his lawyer in Washington, D.C., was not immediately returned, nor was a message left at a home listing for Dutta-Gupta.

Mariano surrendered Monday and was released on $50,000 unsecured bond. His lawyer, Paul Mastrocola, declined to comment.

Copyright 2011 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


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