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Prosecutors allege AISC failed to staff the project as required in the various contracts, but still billed the government for services. Tory Milos, a captain in the New York Air National Guard and one-time girlfriend of Young, was tasked with approving invoices for work performed by contractors for the Army; she verified that AISC was "fully performing" and authorized payments to the company, according to the complaint.
"This resulted in a financial windfall for AISC," it states. Milos benefited, too, receiving $18,000 in payments from a New Hampshire-based property development company Young co-owned, the complaint alleges. An attempt to reach Milos for comment Friday was unsuccessful.
Who is David Young?
David Young and one-time Utah resident Christopher Harris are key figures in what federal prosecutors say was a massive scheme to defraud the Department of Defense. According to the Tampa Bay Tribune, in addition to his military service Young had an illustrious political career — becoming one of New Hampshire’s youngest state legislators at age 21, taking a lead role in John McCain’s presidential campaign in the state and attending inaugurations for both Bush Sr. and Bush Jr. It was during his years of state service that Young became known as a brash maverick, the newspaper said.
Trouble tailed him, but for a time never stuck. The newspaper reported he was charged but cleared of unauthorized use of military vehicles in the Gulf War; he sued the Boston Globe after it linked him to a housing construction scheme.
But Young was disbarred in 2006 after a string of clients accused him of mishandling their money. And in 2009, the military charged him with taking a pair of Humvees without permission while serving in Afghanistan. He was court-martialed; a jury found him guilty.
By Aug. 8, 2009, the original contract had been extended and modified nine times, and AISC had received payments of slightly more than $26 million. And after the initial contract expired in August 2009, AISC was awarded four new sole-source consecutive contracts through Dec. 15, 2010.
In the end, the total payments AISC received through the five Department of Defense contracts, a "portion" of which it used to cover project-related expenses, amounted to nearly $54 million. About one-third of those government payments eventually flowed to Harris. In 2010 alone, he received more than $5.7 million.
Following the money » According to the complaint, Young, Harris and others moved money between approximately 115 bank accounts to "conceal and disguise" the fraudulently obtained proceeds. While some money was spent on expenses associated with the government contract, prosecutors allege large sums — more than $17.4 million between Nov. 26, 2007, and Oct. 28, 2010 — were diverted to Harris’ personal checking accounts.
From there, funds moved through a "web of complicated wire transfers" to other accounts that benefited Harris, Young, Cox and others, the government alleges. Some money flowed through real estate companies that Young either set up or helped manage in New Hampshire and Florida, where it was used to buy property or pay mortgage loans. Other funds went to World Wide Trainers, which Young also was actively involved in and which acted as a subcontractor for AISC to recruit and provide personnel for the Army contracts. Some money also was allegedly laundered through Welventure, a shell company associated with Young, the complaint states.
Welventure then trickled out funds to various accounts, and also made payments totaling $16,000 to Cox last May. The Salt Lake Tribune was unable to locate Cox for immediate comment.
While Harris used his money on homes in Arizona and Utah, Young spent lavishly in Florida. Young, either directly or through a holding company he set up, purchased 13 properties, a Sea Ray Mercruiser, a Hummer and two older Jaguars. Young also spent $332,125 on 225 one-ounce U.S. Gold Eagle coins and $247,000 on 200 one-ounce South African Gold Krugerrands. He has filed a claim to those items as well as funds in 10 different bank accounts.
As for the allegations he and others conspired to defraud the Department of Defense, Young told the Tampa Bay Tribune in April that "third parties" were responsible; in court documents he denies knowing of or participating in any scheme to defraud the government or conceal proceeds from the military contracts.
In court documents, AISC also denies that it was aware of or participated in any conspiracy or scheme to defraud the Department of Defense or to inflate project costs. It also denies that Young tipped the company about the original project’s estimate and claims there are other factual misstatements in the government’s allegations.
AISC has asked the court to dismiss the action on the grounds that Utah is not the proper forum for the dispute; it also says it should be dismissed from the action because it is an "innocent owner" of the property being seized and the value of its seized property is "disproportional to the extent of the purported wrongdoing, including any purported wrongdoing on the part of AISC."
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