NEWARK, NJ – Alan Aranowitz, a 75-year-old businessman from Roseland, New Jersey, has pleaded guilty to charges of wire fraud conspiracy related to defrauding the U.S. Department of Defense (DoD). U.S. Attorney Philip R. Sellinger announced that Aranowitz admitted to his role in schemes involving unauthorized military equipment parts and bid rigging for DoD contracts.
In Newark federal court, Aranowitz entered his plea before U.S. District Judge Julien X. Neals, facing two counts of wire fraud conspiracy. From 2015 through August 2018, Aranowitz and co-conspirators engaged in unlawful product substitution, supplying the DoD with cheaper counterfeit and non-conforming parts such as screws, nuts, and bolts through his company, Arlo Corporation. These parts were misrepresented as meeting military specifications (MIL-SPEC) or as being products of specific manufacturers, which they were not.
Additionally, from 2017 through August 2018, Aranowitz colluded with another DoD contractor to rig bids by coordinating prices, violating DoD’s requirement for contractors to arrive at bids independently. This collusion aimed to inflate profits unlawfully at the expense of the Defense Logistics Agency (DLA) and ultimately, U.S. military end users who reported multiple issues with the substandard parts.
As part of his plea agreement, Aranowitz has agreed to forfeit $684,168 in proceeds from these fraudulent activities and pay $878,644 in restitution to the DoD. The wire fraud conspiracy charges carry a statutory maximum of 20 years in prison and a $250,000 fine per count. Sentencing is scheduled for October 29, 2024.
This case highlights significant violations of federal procurement laws and the integrity of the supply chain to the U.S. armed forces. The ongoing investigation aims to uphold the standards and trust placed in military equipment providers.