State Department Official Funneled Government SUVs to Retailer in Kickback Scheme: DOJ

An unnamed State Department employee and the manager of a northern Virginia repair shop appropriated and sold government vehicles for profit, the U.S. Department of Justice revealed Thursday.

The kickback scheme, detailed in a release from the U.S. Attorney’s Office, saw over a dozen State Department motor pool SUVs and a truckload of tires and wheels sold through a collision repair shop in Springfield, Virginia. The shop, Car Collision Center, is the go-to repair facility for various government departments.

It also has a license to sell vehicles.

Following an investigation, the DOJ learned that an unnamed State Department official who was responsible for repair and maintenance of armored motor pool vehicles — as well as record-keeping — funneled unarmored SUVs to the manager of the repair shop, who then sold them for profit. The retailing side of the business is known as Collector’s Auto Restoration.

Most of the proceeds went to the manager and a second, unnamed person at the shop. The government official, identified only as “Person B” in court documents, pocketed the rest.

James Ratcliffe, 67, has pleaded guilty in the U.S. District Court for the District of Columbia to a charge of conspiracy to commit theft of government property, as well as wire fraud. The manager, who faces up to two years in prison (under federal guidelines) and a fine of up to $40,000, is required to pay back $416,020 in restitution, plus the same amount in a forfeiture money judgement.

How did the scheme come together? The DOJ document states:

According to the statement of offense, on at least two occasions in 2011 and 2012, “Person B” caused truckloads of State Department tires and wheels to be delivered to the Collision Center. “Person B” told Ratcliffe that he could sell them and keep the proceeds. Ratcliffe kept the full proceeds of his sales, which amounted to at least $7,500.

Also, beginning in or before June 2011, and continuing through at least November 2013, “Person B” and Ratcliffe took a Hummer and 12 Chevrolet Suburbans from the State Department motor pool; these vehicles were unarmored. They agreed that Ratcliffe would sell the vehicles and split the proceeds with “Person B.” Ratcliffe typically sold the misappropriated vehicles for at or near market prices. The total sales price of the misappropriated vehicles was $408,520, according to the statement of offense. Ratcliffe and “Person A” kept the majority of these proceeds for their personal benefit and the remainder went to “Person B.” Additionally, in 2015, “Person B” provided Ratcliffe with two unarmored Suburbans that Ratcliffe kept at his place of business or home. The base price of these vehicles was $48,200 each, for a total of $96,400. The two vehicles were recovered during a law enforcement investigation of the criminal activities.

The total value of the U.S. property funneled to Ratcliffe is estimated at $512,420.

[Image: General Motors]