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Financial Crimes
06/04/2009

Former U.S. Army officer sentenced for role in Iraqi fraud scheme

WASHINGTON - Debra Harrison, a former lieutenant colonel in the U.S. Army Reserves, was sentenced today to 30 months in prison for her participation in a scheme to defraud the U.S. government, the Republic of Iraq and the Coalition Provisional Authority - South Central Region (CPA-SC) in Al-Hillah, Iraq, announced Assistant U.S. Attorney General Lanny A. Breuer.. Harrison was also ordered to serve two years of supervised release following her incarceration and to pay $366,640 in restitution. U.S. Immigration and Customs Enforcement (ICE) helped investigate the case.

Harrison, 50, of Trenton, N.J., pleaded guilty to one count of honest services wire fraud on July 28, 2008, before Judge Mary L. Cooper at the U.S. District Court for the District of New Jersey, Trenton Division. At the plea hearing, Harrison admitted that in August 2004, she received a Cadillac Escalade from Philip Bloom, a contractor at the CPA-SC. The Escalade was financed through a series of wire transfer payments, which form the basis of the wire fraud charge. Harrison admitted that she took more than $300,000 from the CPA-SC while deployed there and that she used some of the stolen money to make improvements at her home. Harrison also admitted that in July 2004, she helped to move unregistered firearms from a hotel in North Carolina to the home of Robert Stein, a co-conspirator who worked with Harrison at the CPA-SC.

Stein was sentenced on Jan. 29, 2007, to nine years in prison and ordered to forfeit $3.6 million. He pleaded guilty on Feb. 2, 2006, in U.S. District Court for the District of Columbia to conspiracy, bribery, money laundering, possession of machine guns and being a felon in possession of a firearm for his role in the scheme to defraud the CPA-SC.

On April 18, 2006, Bloom pleaded guilty in U.S. District Court for the District of Columbia to related charges of conspiracy, bribery and money laundering in connection with the scheme. Bloom was sentenced on Feb. 16, 2007, to 46 months in prison and ordered to forfeit $3.6 million.

On Aug. 25, 2006, Lt. Col. Bruce Hopfengardner pleaded guilty in U.S. District Court for the District of Columbia to charges of conspiracy to commit wire fraud and money laundering in connection with the scheme. Hopfengardner was sentenced on July 2, 2007, to 21 months in prison and ordered to forfeit $144,500.

On Feb. 1, 2007, Col. Curtis Whiteford, Lt. Col. Michael Wheeler, Seymour Morris Jr. and William Driver were charged in a 25-count indictment with related charges including conspiracy, bribery and money laundering in connection with this scheme. Whiteford and Wheeler were convicted by a jury after trial on Nov. 7, 2008. Morris was acquitted. Driver, whose case was severed, is awaiting trial.

In October 2006, the Department of Justice announced the formation of a National Procurement Fraud Task Force designed to promote the early detection, identification, prevention and prosecution of procurement fraud associated with the increase in government contracting activity for national security and other government programs. The Procurement Fraud Task Force, chaired by Assistant Attorney General Breuer, includes ICE, the U.S. Attorneys' Offices, the FBI, the U.S. Inspectors General community, and a number of other federal law enforcement agencies. The cases brought by members of the task force demonstrate the federal government's commitment to helping ensure the integrity of the government procurement process.