Ibis Tek owners plead guilty in federal court
BUTLER TWP — Two Butler County brothers charged last year with orchestrating a multi-million-dollar scheme to defraud the U.S. Army have pleaded guilty to federal fraud charges and tax evasion, according to online court documents.
The brothers, Thomas and John Buckner, entered guilty pleas Wednesday in federal court, at a proceeding where they waived indictment on the charges — one count of fraud and two counts of tax evasion — which are connected to a contract Ibis Tek had with the U.S. Department of Defense.
Ibis Tek was supposed to produce vehicle emergency escape window kits for Humvees, but the brothers admitted Wednesday that they defrauded the U.S. Army Tank-Automotive and Armaments Commands (TACOM) by inflating costs and creating a shell company called Alloy America LLC, which they used to drive up the price of Chinese-made components.
The Buckners also admitted that they sold scrap aluminum collected during the manufacturing process and did not credit the money to the government's contract.
Also pleading guilty Wednesday was Ibis Tek's former CFO, Harry Kramer. U.S. DIstrict Judge Arthur Schwab is set to sentence the men at 9 a.m. Oct. 10, at federal court in Pittsburgh.
The fraud cost the DOD more than $6 million, according to court documents filed by federal prosecutors in the case.
The Buckers also pleaded guilty Wednesday to tax evasion, admitting that they failed to report income from the aluminum sales in 2009 and 2010, and declared illegal deductions from more than $1 million in gratuities they paid to Anthony Shaw, 55, of Rochester Hills, Mich., who was the civilian TACOM employee in charge of the Humvee contract.
Shaw has also been charged with tax evasion in the case and is expected to plead guilty Thursday.
The fifth and final defendant in the case, David Bucker of Michigan, is also expected to plead guilty Thursday to charges that he funneled the illegal payments from the Buckner brothers to Shaw and attempted to conceal them from the Internal Revenue Service. David Buckner is not related to Thomas and John Buckner.
The brothers face a maximum of 20 years in prison and a fine of $1.5 million.
