Projo.com: NAVSEA Stripped of Contract Authority in Wake of Middletown Defense Contractor Scandal

Projo.com on Tuesday was reporting that the United States Navy had stripped the Naval Undersea Warfare Center in Newport (NAVSEA) of its ability to approve defense contracts, citing a Navy official.

The publication also quoted a Washington-based defense industry insider as saying the sanction signaled a lack of confidence in the local Naval command and seldom happens.

The report is the latest fallout from the federal investigation into a multimillion defense contractor bribery and kickback case that allegedly implicated the founder and former president of , which had maintained an office in Middletown before closing in February after the federal government seized its assets.

The case since then also has sparked a U.S. Navy  into the practices for awarding defense contracts.

ASFT closed on February 14, resulting in the loss of jobs to about 100 local employees after the federal government seized the company's assets as part of its ongoing bribery investigation involving ASFT and a Navy civilian employee.

Ralph Mariano, 52, of Arlington, VA, was working as a civilian program manager and senior systems engineer with the Naval Sea Systems Command (NAVSEA) in Newport at the time of his Feb. 8 arrest.

Federal prosecutors have accused Mariano, along with Anjan Dutta-Gupta, 58, of Roswell, GA, founder and president of ASFT of participating in an alleged  in which Dutta-Gupta funneled approximately $10 million dollars to Mariano, Mariano’s relatives, and Mariano’s associates in return for Mariano’s role in the funding of Naval contracts to ASFT.

Last week it was announced by United States Attorney Peter F. Neronha that Dutta-Gupta had agreed to plead guilty in U.S. District Court in Providence to bribery of a public official in connection with an alleged kickback scheme of more than $9 million in Navy defense contracts.

ASFT had a local office in Middletown and headquarters in Roswell, Georgia.