An investigation by the Defense Criminal Investigative Service (DCIS) and the Naval Criminal Investigative Service (NCIS) ended in multiple federal charges against three Mobile men in a dollar accounting fraud scheme at Austal USA LLC, a U.S. Navy shipbuilder in Alabama.
Craig Perciavalle, 52, Joseph Runkel, 54, and William Adams, 63, all of Mobile, are charged with one count of conspiracy to commit wire fraud and wire fraud affecting a financial institution, five counts of wire fraud, and two counts of wire fraud affecting a financial institution.
A federal jury indicted the three men after prosecutors said they conspired to mislead Austal Limited’s shareholders about the company’s financial situation.
“Specifically, the defendants are alleged to have artificially reduced and suppressed an accounting metric known as ‘estimate at completion’ (EAC) in relation to multiple LCS ships that Austal USA was building for the U.S. Navy,” The U.S. Department of Justice said in a press release. “Suppressing the EACs allegedly falsely overstated Austal Limited’s reported earnings in its public financial statements.
Austal Limited, an Australian company, is the parent company of Austal USA LLC, which operates in Mobile.
“The defendants allegedly did this, among other reasons, to maintain and increase the share price of Austal Limited’s stock,” the press release continued. “When the higher costs were eventually disclosed to the market, the stock price was significantly negatively impacted and Austal Limited wrote down over $100 million.”
If convicted, Perciavalle, Adams and Runkel face a maximum penalty of 30 years in prison for the conspiracy count and each count of wire fraud affecting a financial institution and 20 years in prison for each count of wire fraud.
The suspects are considered innocent until proven guilty.
Austal USA LLC has been in operation since 1999.
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