La Mesan Among North Island Workers Who Pled Guilty in Bribery Scheme

The local U.S. Attorney's Office said Wednesday that a group of Navy employees and defense contractors entered guilty pleas to fraud charges stemming from a $1 million bribery case at North Island Naval Air Station.

Four employees of the base's Fleet Readiness Center were accused of accepting bribes to falsely bill the Navy for services from three employees of contractors located in Carlsbad and Poway, according to federal prosecutors.

The contractors charged are:

• Michael Graven, 43, owner and operator of X&D Supply Inc., in Carlsbad, which received at least $2.26 million in contracts connected to the case.
• John Newman, 51, a sales manager and former owner of a defense contractor identified in court records only as “Company A,” located in Poway. The Navy paid the firm at least $3.31 million in contracts connected to the case.
• Paul Grubiss, 39, was a sales manager of a defense contractor identified in court records as “Company B,” also located in Poway. The Navy paid the firm approximately $1 million in connection with the case. Grubiss resides in Ohio.

The charges including conspiracy to commit wire fraud and conspiracy to commit bribery, along with three counts of filing of false tax returns.

The North Island workers charged are:

• Donald Vangundy, 54, Chula Vista, a superviser who authorized the purchase and replacement of tools for Fleet Readiness Center programs. 
• Kiet Luc, 53, San Diego, liaison and coordinator for an aircraft tool program. 
• David Lindsay, 57, San Diego, supervisory production controller for an aircraft program.
• Brian Delaney, 55, La Mesa, deputy program manager for the aircraft program. 

Prosecutors said another man, Jesse Denome, owner of JD Machine Tech Inc., also was implicated in the case, but he was not part of the group that entered pleas Wednesday.

Investigators said the contractors coerced civilian employees with cash, gift cards, furniture, electronics, home remodeling services and other gifts, which were charged to the Navy as part of their defense contracts.

Prosecutors said in exchange for the bribes, the workers entered fraudulent orders with the contractors.

The employees were associated with a Navy aircraft program, the E2/C2, which maintains the tactical readiness of the planes. The E2, prosecutors said, is thought of as “the eyes of the fleet” for early warning tactical operations.

Sentencing for the group is set for July 2.