An employee who worked for President Obama's pick for federal CIO has been arrested by the FBI and charged in a federal bribery sting.
Federal law enforcement officials filed bribery charges against the District of Columbia's acting chief security officer, along with a one-time Washington DC government employee who owns an IT outsourcing company that runs offshore operations in India.
Both were later arraigned in federal court.
Yusuf Acar, the District's acting chief security officer, was arrested this morning; Police found US$70,000 in cash in his Washington home.
Acar's annual salary is $127,468 (£92,480).
The second suspect arraigned on bribery charges is Sushil Bansal, CEO and founder of Advanced Integrated Technology, (AITC) a Washington-based operation that has won a number of contracts with the District.
From March 2004 to February of this year, AITC did more than $13 million worth of business with the D.C. government.
What drew extra attention to this case is its connection to Vivek Kundra, the former chief technology officer for D.C. recently appointed by President Barack Obama to be the US government's first CIO.
Kundra was appointed to the District post in 2007. AITC received contracts before Kundra was appointed and after, including the extension of an IT security support deal that included antivirus deployment and incident response.
There is nothing in the federal documents, however, indicating that Kundra had any knowledge of any illegal activity related to today's arrests.
In court, a sombre US District Judge John Facciola told Acar that the "crimes speak of bribery, adding that these "are serious federal charges." Acar, who appeared to be in his mid-30s, said nothing in court other than to state his name.
The US attorney representing the government in the case, Tom Hibarger, told Facciola that Acar posed "a serious risk of flight." According to Hibarger, Acar has relatives in Turkey and had made statements that he was ready to leave the country "and take a large amount of currency with him."
Acar was ordered held without bail. Bansal was released, but ordered not to leave the area.
In an affidavit, the federal government alleged that Acar worked with a vendor to submit a purchase order for one quantity of goods, "and in actuality a lesser quantity [was] ordered and delivered." The scheme was complex and involved adding people to the payroll who didn't exist - they were called "ghost employees." Payments were allegedly made to those "workers."
Acar also is accused of hiring ghost employees through a vendor and allegedly approving timesheets for them.
In what the government officials described as the "Mcafee Software Scheme", Bansal's firm submitted a purchase order for 2,000 units of McAfee Foundstone software, which is used to provide automated scanning and vulnerability assessments, for $104,166.
McAfee generated a quote for AITC for the purchase of 500 units of the software at $36,845, but AITC, the provider in this case, charged the D.C. government for 2,000 licences.