The Tribune Democrat, Johnstown, PA

April 16, 2013

Brothers plead guilty to fraud

Founders of defense firm face lengthy federal prison terms

Patrick Buchnowski

JOHNSTOWN — Two brothers who owned a defense contracting business in Windber pleaded guilty in federal court Tuesday to defrauding the government.

William Kuchera, 58, of Summerhill, and Ronald Kuchera, 51, of Johnstown, appeared before U.S. District Judge Kim Gibson. Both men waived their rights to be indicted and to have a jury trial.

They both pleaded guilty to major fraud against the government and conspiracy. They face up to 15 years in prison and millions in fines and civil penalties.

Government investigators outlined their case against the brothers who operated Kuchera Defense Systems Inc.  

The pair claimed lobbying costs, hunting trips and a private airplane as business expenses. Some of those expenses were invested in a game ranch.

The Kucheras also submitted a false invoice for $650,000 to Coherent Systems International Inc., which was a defense contractor owned by Richard S. Ianieri.

As a prime contractor, Coherent was responsible for an $8 million defense contract for the Ground Mobile Gateway Systems. The invoice sought payment for a component that was never delivered.

After receiving the $650,000 from Coherent, the brothers kicked back to Ianieri about $200,000.

In July 2009, Ianeri pleaded guilty to soliciting kickbacks and was sentenced to five years probation and ordered to pay $200,000.

Each brother has agreed to pay a $50,000 fine.

Richard Kuchera agreed to the civil forfeiture of an additional $450,000 and agreed to make payments to the IRS of $121,313.

William Kuchera also agreed to the civil forfeiture of $450,000 and pay restitution to the IRS of $257,168.

The Kucheras and KDS will also pay $2.7 million to resolve   their civil liabilities with the Defense Department.

“The Kucheras cheated the government by claiming improper reimbursement, submitting a false invoice, and then kicking back $200,000 to the prime contracter,” U.S. Attorney David J. Hickton said in a statement.

“Such blatant and outrageous fraud against the United States cannot and will not be tolerated,” he said.

The Kucheras will be sentenced Oct. 7. They are free on unsecured bond.

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