Former high-ranking Navy civilian sentenced for helping defense contractor get government work
By SCOTT DAUGHERTY | The Virginian-Pilot (Tribune News Service) | Published: October 14, 2017
NORFOLK, Va. — A former high-ranking civilian employee of the Navy was sentenced Friday to three years and four months in prison for his role in a multimillion-dollar fraud perpetrated by a North Carolina-based defense contractor.
William Hutsenpiller – who headed Norfolk Ship Support Activity’s financial department until late 2013 – pleaded guilty earlier this year to receiving about $36,000 in so-called “gratuities,” documents said.
In exchange, he helped steer millions in contracts to the company and amass a $5.1 million reserve fund using money that should have been returned to the government.
According to court documents, the charges against Hutsenpiller stemmed from an extended relationship he had with Philip A. Mearing and his company, Global Services Corp. of Fayetteville, N.C.
Court documents said Hutsenpiller, of Virginia Beach, oversaw Norfolk Ship Support Activity’s $200 million operating budget from October 2009 through November 2013.
Norfolk Ship Support Activity is a Navy command that oversees all maintenance done by private companies on surface ships in the mid-Atlantic region. It is now known as the Mid-Atlantic Regional Maintenance Center.
Prosecutors allege Mearing and Hutsenpiller met in 2008 while Mearing’s company was working as a subcontractor on that command’s prime contract.
In 2010, however, the command awarded a new prime contract to a different company.
Prosecutors claim Hutsenpiller, Mearing and at least one other Global Services employee conspired to coerce the new contract holder to take on Global Services as a subcontractor.
Mearing and Global Services never paid Hutsenpiller, who was at the top of the federal pay scale as a GS-15, for his assistance. Upon his retirement, however, he wanted Global Services to give him a job that would pay $150,000 a year.
That never happened.
The relationship was still lucrative for Hutsenpiller, though. Over the years, he directed a conspirator to pay for his cellphone service and buy several pieces of electronics for him and his family, including an iPad Air, iPad mini, Apple TV and Bose headphones. The total value of those items and services: $35,870.69.
Mearing, Global Services’ president, pleaded guilty earlier this year to conspiracy to commit wire fraud. He is set to be sentenced Dec. 1.
Court documents filed in his case reference a much larger fraud conspiracy, involving more than $13.6 million.
Kenneth Deines, the company’s comptroller, pleaded guilty last year to conspiracy to defraud the government. He was sentenced to 18 months.
Another person involved in a related scam, Kenneth Bricker of Newport News, entered into a separate plea agreement. He was sentenced to four years.
Hutsenpiller, Deines and Bricker all agreed to help with the prosecution of Mearing.
©2017 The Virginian-Pilot (Norfolk, Va.)
Visit The Virginian-Pilot (Norfolk, Va.) at pilotonline.com
Distributed by Tribune Content Agency, LLC.