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Defense Consultant Vows to Fight “Ill Wind” Charges

September 27, 1989

ALEXANDRIA, Va. (AP) _ The indictment of defense consultant Thomas E. Muldoon will likely send prosecutors investigating Pentagon procurement fraud to trial for the second time in the 3-year-old probe.

All but two of the 23 individuals convicted in the ″Ill Wind″ case have pleaded guilty, but Muldoon’s lawyer said Tuesday that Muldoon has already turned down a government offer to plead guilty and denies charges that he participated in a scheme to bribe a Marine Corps procurement official.

″Muldoon denies it all, denies there was any criminal intent on his part at any time,″ Albert J. Ahern Jr. said. ″His position from the very beginning is that he denied any bribery, therefore he isn’t going to plea to that.″

Court documents portray Muldoon as a major figure in the defense procurement scandal, operating in a network of people who got secret information on contracts from Pentagon sources and sold it to companies seeking the military contracts.

He was charged Tuesday after two former executives of Whittaker Command and Control Systems, and the corporate unit itself, pleaded guilty to participating in the bribery scheme with Muldoon.

Scott M. Lamberth, the subsidiary’s former president, and John F. Van Tassel, once director of its Fayetteville, Ark., operations, said they funneled more than $80,000 in bribes to Marine Corps procurement official Jack Sherman through Muldoon and two other defense consultants, John Marlowe and Donald Illeman.

Marlowe is the government’s original informant who led investigators to Sherman, who pleaded guilty to taking other bribes and received an 18-month sentence.

According to court papers filed Tuesday, the bribery scheme began with a private company called Lee Telecommunications, which Whittaker Corp. purchased in 1986 and made a subsidiary.

In 1981, Lee Telecommunications arranged, through Muldoon, to bribe Sherman to help obtain a contract to provide an electronics component for a battlefield air traffic control system being developed by the Marines, according to the court papers.

Over seven years, Lee paid $200,000 to Marlowe, Muldoon and Illeman, who shared their fees with Sherman, prosecutors say.

The Marine Corps official then authorized modifications in the company’s contracts that brought their total value to $7.7 million.

Indicted with Muldoon on Tuesday was Leonard L. Ingram, former vice president of Lee Telecommunications, and later of the Whittaker Command subsidiary.

Ingram’s attorney, Marcus Topel, said Ingram also wanted to stand trial.

″I think this is a classic case of guilt by association,″ the San Francisco lawyer said. ″I think the trial will show he had absolutely nothing to do with any of these wrongful activities, and at most was present at various times when they were discussed and did nothing further than that.″

In the only other jury trial resulting from the investigation, two Teledyne Electronics executives were convicted last spring of conspiracy and wire fraud but were cleared of charges they participated in a separate bribery scheme.

The guilty plea by the Whittaker subsidiary is the third by a corporation in the case.

Teledyne Industries and Hazeltine Corp. pleaded guilty in connection with their roles in the procurement scandal.

The Whittaker subsidiary agreed to pay $3.5 million in fines and penalties. According to court papers, Lamberth deliberately withheld information about the bribery scheme from Whittaker Corp. officials in Los Angeles.

Company attorney Daniel H. Bookin told U.S. District Judge Claude Hilton Whittaker officials in Los Angeles were unaware of the scheme. ″No one who is involved in those activities is currently with the company,″ he said.

09-27-89 0729EDT

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