The Los Angeles Veterans Affairs facility in West L.A. has been embroiled in controversy for many years. This is the same facility that leased out their property to privately owned businesses, which wound up in a major lawsuit. They were building an amphitheater, and had been leasing land to Twentieth Century Fox Television, as well as UCLA. These groups had engaged in illicit behavior with the VA, and the courts ordered these deals to be terminated. This has been an ongoing scandal for years, and the VA has had to pay substantial sums to ensure that it pays for the businesses to remove themselves from the properties and to back out of their agreements.

More recently, Ralph Tillman, VA contract officer, was charged with lying to the VA investigators involving a bribery scheme he had with a parking lot operator, and to falsely filing his federal tax return. He plead guilty to two felonies, as his scheme with the parking lot operator garnered him over a quarter of a million in bribes.

Richard Scott, of Westside Services LLC, operated the parking lot across from the VA Hospital in the area. He had a contract to operate there through the VA. Scott was basically misreporting his financial statements to the VA — statements that Tillman was charged with looking over. Essentially, Scott would bribe Tillman in sealed FedEx envelopes, so Tillman would dismiss any errors in his annual reports and the two could continue to make cash on the side from the discrepancies.

Scott was exaggerating expenses, over charging the VA; he was also under-reporting profits. On Tillman’s end, the bribes added up to $286,250 and Scott apparently withheld $11 million from the VA, according to the Department of Justice. Tillman said in an affidavit that, “He was definitely bribing me, and I was definitely looking the other way.”

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When initially asked by VA investigators, Tillman denied any such activity. This made it worse for him, and now he may face up to eight years in federal prison. He also did not report the $286,250 on his tax return, hence the fraudulent tax charges.

Scott, on the other hand, has plead not guilty. His investigation is ongoing — the FBI, IRS, VA and OIC are all currently involved. The federal grand jury has accused him of 15 charges, major fraud being one and conspiracy being another.

 

Featured image courtesy of Flickr.