Baltimore, Maryland – U.S. District Judge Ellen L. Hollander today sentenced Todd Andrew Leasure, age 45, of Orange Beach, Alabama, to six months of home detention as part of five years’ probation, for the federal charge of making false statements in connection with the number of hours he worked on a contract at the National Security Agency (NSA).  Judge Hollander also ordered Leasure to pay restitution of $150,001.

The sentence was announced by United States Attorney for the District of Maryland Robert K. Hur; Robert P. Storch, Inspector General of the National Security Agency; and Special Agent in Charge Robert E. Craig, Jr. of the Defense Criminal Investigative Service - Mid-Atlantic Field Office.

The National Security Agency (NSA) is a component of the United States Department of Defense.  Beginning in 2008, the NSA contracted with an outside company (Contractor A) to supply information technology (IT) services to the NSA, including onsite database administrators employed by Contractor A. 

According to his plea agreement, from February 2014 through February 2017, Leasure was employed on a full-time basis by Contractor A to work as a database administrator pursuant to the contract between NSA and Contractor A.  Leasure’s duty station was at a NSA facility located in Linthicum Heights, Maryland, and Leasure regularly traveled from Florida to Maryland to perform his responsibilities under the contract. 

Contractor A required Leasure to submit timesheets in electronic format providing date- and task-specific entries stating the number of hours he had worked on the contract.  Based on those entries, Contractor A periodically invoiced the NSA for the hours that Leasure worked, and NSA paid Contractor A for Leasure’s claimed hours at a rate of $247 to $280 per hour.

Leasure admitted that between February 3, 2014 and February 17, 2017, he submitted, and caused to be submitted, false timesheets to Contractor A in which he claimed to have worked at least 607 hours more than he actually worked on the NSA contract.  As a result, NSA overpaid Contractor A by an amount exceeding $150,000.

In a separate case, on December 6, 2019, U.S. District Judge Richard D. Bennett sentenced Kyle Duran Smego, age 41, of Raleigh, North Carolina, to serve eight months of home detention as a special condition of three years’ probation, and ordered Smego to pay restitution of $252,527.15.  Smego, who was a subcontractor at two companies where he was assigned to work on contracts at the NSA, previously pleaded guilty to submitting false claims to the government, inflating the number of hours he claimed to have worked on the two contacts by at least 40%.

Anyone with information about fraud at NSA may contact the NSA Office of the Inspector General at https://www.nsa.gov/about/contact-us/OIG-Hotline/.

United States Attorney Robert K. Hur commended the NSA OIG for their work in both investigations and the DOD OIG for its work in the Leasure investigation.  Mr. Hur thanked Assistant U.S. Attorneys Peter J. Martinez and Jefferson M. Gray, who prosecuted the Leasure and Smego cases, respectively.

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Baltimore, Maryland – Kyle Duran Smego, age 40, of Raleigh, North Carolina, pleaded guilty on July 2, 2019, to submitting false claims to the United States, specifically for inflating the number of hours he claimed to have worked on two government contracts. 

The guilty plea was announced by United States Attorney for the District of Maryland Robert K. Hur and Robert P. Storch, Inspector General of the National Security Agency.

The National Security Agency (NSA) is a component of the United States Department of Defense.  During the period from February 2016 to present, the NSA had two ongoing contracts with an outside company (Contractor A).  Each of these contracts required Contractor A to supply information technology (IT) services to the NSA.  Contractor A subcontracted with Subcontractors 1 and 2, respectively, to provide software engineers and developers needed to carry out its obligations under each contract.  

According to his plea agreement, from February 2016 through May 2018, Kyle Duran Smego was successively employed on a full-time basis by Subcontractors 1 and 2 to work as a software engineer/front end developer on the two separate contracts held by Contractor A.  Because the subject matter of these contracts involved classified information, all of the work had to be performed at secure, access-controlled locations.  Smego was therefore required to be physically present at his assigned duty locations to do his work. 

Between February 2016 and November 2017, Smego reported to Subcontractor 1 that he had worked 3,289 hours on their contract.  Between November 2017 and May 2018, Smego reported to Subcontractor 2 that he had worked 797.5 hours on their contract.  A subsequent review by the NSA of key card and timecard information demonstrated that Smego was not actually present at his assigned duty stations for at least 1,326 of the 3,289 hours he had reported to Subcontractor 1 (40.3%) and 375 of the 797.5 hours he had reported to Subcontractor 2 (47%).  In addition to overstating the number of hours he had worked, the timesheets that Smego submitted to Subcontractors 1 and 2 included entries for 119 separate days in which Smego represented that he had worked an average of 8 hours when, in fact, he had not worked at all on those days. 

All of the hours that were falsely reported by Smego were subsequently billed by the subcontractors to Contractor A, and were in turn billed by Contractor A to, and paid by, NSA.  Based upon the false billing records submitted by Smego, the NSA overpaid a total of $220,379.42 to Contractor A.  Contractor A, in turn, paid most of those funds over to Subcontractors 1 and 2, who ultimately paid Smego $115,110 for work he had not performed.

As part of his plea agreement, Smego will be required to pay restitution and to forfeit any assets derived from or traceable to the offense.

Smego faces a maximum sentence of five years in prison.  U.S. District Judge Richard D. Bennett has scheduled sentencing for October 3, 2019 at 3:00 p.m.

United States Attorney Robert K. Hur commended NSA Senior Investigator Lori Hazenstab and the NSA OIG for their work in the investigation.  Mr. Hur thanked Assistant U.S. Attorney Jefferson M. Gray, who is prosecuting the case.

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