Kuchera Brothers Plead Guilty to Fraud Against the Government

JOHNSTOWN, PA—Two brothers who owned a major defense contracting firm waived indictment and pleaded guilty today in federal court to charges of major fraud against the government and conspiracy, United States Attorney David J. Hickton announced.

William Kuchera, 58, of Summerhill, Pennsylvania, and Ronald Kuchera, 51, of Johnstown, Pennsylvania, pleaded guilty to two counts before United States District Judge Kim Gibson.

In connection with the guilty plea, the court was advised that William and Ronald Kuchera owned and managed Kuchera Defense Systems Inc. (KDS), a contractor for the Department of Defense. KDS submitted cost certifications to the government containing unallowable expenses that inflated costs for overhead and general and administrative expenses. These unallowable expenses included the leasing of a private airplane, vacations to Jamaica, personal car leases, improvements on a private residence, and lobbying fees.

The Kuchera brothers also submitted a false invoice for $650,000 to Coherent Systems International Inc. (Coherent), a defense contractor owned by Richard S. Ianieri. As the prime contractor, Coherent was responsible for an $8 million Department of Defense contract for the Ground Mobile Gateway Systems, which involved the development of a new prototype unmanned vehicle that was designed to prevent friendly-fire incidents. The invoice sought payment for a component that had never been manufactured or delivered to Coherent. After receiving the $650,000 payment from Coherent, the Kuchera brothers kicked back to Ianieri approximately $200,000.

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