VANISHED: Suspected CityTime fraudsters Reddy Allen and wife Dr. Padma Allen (above) have fled to India. (
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The clock has yet to run out on the CityTime scandal, with a grand jury alleging yesterday that more than $600 million of the project’s bloated budget is “tainted” by fraud.
A new indictment charged the husband-and-wife owners of a New Jersey company with raking in more than $460 million in crooked cash through a record-setting corruption scheme.
Court papers say Reddy and Dr. Padma Allen secured a lucrative, no-bid subcontract that made it look like their firm, TechnoDyne, was “a successful and fast-growing company.”
But the “engine of its growth” was actually an overbilling scam in which the Allens paid out more than $15 million in kickbacks and hired a bevy of crooked subcontractors, according to the indictment unsealed in Manhattan federal court.
Authorities say the brazen corruption was part of a “massive and elaborate scheme” involving high-ranking execs at prime contractor Science Applications International Corp. who pocketed $5 for every hour worked by 300-plus consultants. “As a result, virtually the entirety of the well over $600 million that the city paid to SAIC on the CityTime project was tainted, directly or indirectly, by fraud,” the indictment says.
CityTime, which is intended to modernize the municipal payroll system, was initially budgeted at $63 million, but has cost taxpayers more than $720 million to date.
Manhattan US Attorney Preet Bharara called the alleged scam “truly jaw-dropping” and “epic in duration, magnitude and scope.”
Bharara said prosecutors were seeking to have the Allens extradited from their native India, where they fled in February after getting slapped with grand-jury subpoenas.
Also yesterday, authorities revealed that SAIC executive Carl Bell quietly pleaded guilty last week and is cooperating with the probe.
A SAIC spokeswoman said, “We are aware of these developments, but in light of the ongoing investigation, it would be inappropriate for us to comment.”