A former U.S. Air Force Master Sergeant, Alan Hayward James, pleaded guilty on April 1 to participating in a multi-year scheme that inflated the cost of information technology contracts for the U.S. Pacific Air Forces by at least $37 million.
The case is significant because it involved fraudulent practices that diverted millions of dollars from government resources, undermining fair competition and public trust in military contracting.
According to court documents, James conspired with others from at least April 2016 through April 2025 to artificially increase contract costs. The excess funds were used for personal enrichment, including payments to himself, his family members, co-conspirators' families, and an Air Force civilian employee referred to as "Godfather." The conspirators also used government money for personal expenses such as a luxury resort stay in Oahu in 2023. Additionally, between May 2019 and October 2022, James directed supposed competitors on what amounts they should bid for contracts in order to circumvent competitive bidding requirements.
“Over thirty-seven million dollars — that’s how much the U.S. Air Force overpaid because of the scheme that the defendant admitted to, under oath and in open court,” said Acting Deputy Assistant Attorney General Daniel Glad of the Justice Department’s Antitrust Division. “Criminals who rig bids and commit fraud on government contracts steal from taxpayers and threaten the public’s confidence in government institutions. The Antitrust Division’s Procurement Collusion Strike Force will detect and prosecute those who rig bids and defraud their government customers.”
U.S. Attorney Ken Sorenson for the District of Hawaii said: “Through this bid-rigging scheme, the defendant not only stole from American taxpayers and harmed companies seeking to compete honestly for government contracts, he also ultimately harmed essential military services designed to keep our nation safe by diverting resources away from other services... We will continue to investigate and prosecute any and all who would seek to manipulate markets and undermine fair competition for their own personal gain.”
Special Agent John E. Helsing of Defense Criminal Investigative Service said James's plea acknowledges his role "in a long-running conspiracy" targeting both defense funds and taxpayers; Special Agent Nicole Vanourek highlighted joint investigative efforts as key in protecting acquisition systems; Special Agent Christopher Bjornstad emphasized that procurement fraud erodes trust while harming honest businesses.
James agreed to pay more than $1.4 million in restitution. He faces maximum penalties including up to 20 years’ imprisonment for wire fraud conspiracy; up to 15 years’ imprisonment or fines based on bribe value for bribery; up to ten years’ imprisonment or $1 million fine under Sherman Act violations related to bid rigging.
The case was prosecuted by attorneys from both the Antitrust Division’s San Francisco Office and the U.S. Attorney’s Office for Hawaii with assistance from multiple federal investigative agencies.
The Justice Department encourages whistleblowers with information about antitrust offenses impacting government spending programs at all levels—federal, state or local—to report via its Procurement Collusion Strike Force website or through its Whistleblower Rewards Program.
