In a major break in the defense corruption investigation, former Unisys executive Charles Gardner and a company consultant pleaded guilty Thursday to a conspiracy to bribe assistant Navy secretary Melvyn Paisley.
Gardner, who was fired by the giant defense contractor last March during an internal company inquiry, and consultant James Neal pleaded guilty to conspiring to buy Paisley's Sun Valley, Idaho, condominium for an inflated price - $149,000 - then sold it for $100,000.The deal was arranged by another defense consultant being investigated, William Galvin, whose stepson entered a separate plea Thursday to tax evasion charges in connection with his accounting work for Galvin, prosecutors charged.
In return for the payoff to Paisley, U.S. Attorney Henry Hudson told reporters, the company received inside information about pending Navy contracts for the shipboard Aegis electronic warfare system and another major contract.
The separate three-count felony "informations" filed with submission of the pleas before U.S. District Judge Claude Hilton also charged that Gardner masterminded a scheme to launder illegal corporate campaign contributions to Rep. Roy Dyson, D-Md., and former congressman Bill Chappell, D-Fla.
In addition, prosecutors disclosed they had uncovered evidence that a newly identified former Navy figure received $400,000 in bribes.
In return for prosecutors' agreement not to pursue further charges against the three, each pledged to cooperate with investigators.
Hudson, flashing smiles to reporters outside the federal courthouse, said that the pleas of Neal and Gardner "are significant developments, we think, because their cooperation will move this investigation forward at a tremendous pace."
The pleas brought to nine individuals and one defense contractor the number of guilty pleas entered to date in the 33-month-old investigation, code-named "Operation Ill Wind." In addition, indictments are pending against a former Navy engineer, the Teledyne Corp.'s electronics division and several of the firm's former executives and consultants.
Gardner, 58, the former vice president and general manager in charge of Unisys's Surveillance and Fire Control Systems Division in Great Neck, N.Y., faces 23 years in prison and fines of $750,000. Neal, 64, faces up to 15 years in prison and fines of $750,000, and Brooke, 40, faces a maximum penalty of five years in prison and $250,000 in fines.