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Postmaster Admits Involvement in Danbury Post Office Bribery and Kickback Scheme

February 22, 2024

READ FULL ARTICLE AT » United States Department of Justice

Vanessa Roberts Avery, United States Attorney for the District of Connecticut, Kenneth Cleevely, Special Agent in Charge of the United States Postal Service Office of Inspector General, and Robert Fuller, Special Agent in Charge of the Federal Bureau of Investigation, announced that MICHAEL D. LUTZ, 26, of Seymour, pleaded guilty today before U.S. District Judge Stefan R. Underhill in Bridgeport to a conspiracy offense stemming from a bribery and kickback scheme involving the Postmaster of the Danbury Post Office.

According to court documents and statements made in court, Ephrem D. Nguyen was employed by the U.S. Postal Service (“USPS”) as the Postmaster of the Danbury Post Office in Danbury, with responsibilities that included supervising the maintenance and repair of all equipment, facilities, and vehicles assigned to the post office.  Lutz was the general manager for a company, identified in court documents as “Vendor-1,” which provided vehicle maintenance and repair services for the Danbury Post Office.

In November 2020, Nguyen required that all Danbury Post Office vehicle maintenance and repair work be performed by Vendor-1, even though Nguyen knew that another vendor already had a contract with the Danbury Post Office for those services.  Nguyen demanded that Vendor-1 provide free vehicle maintenance and repairs for himself, one of his children, a USPS employee, and employee of Nguyen’s personal business.  In 2022, Nguyen solicited and received from Lutz $90,000 in cash bribes, which Lutz paid from Vendor-1’s proceeds.  In exchange for these bribes, Nguyen caused the USPS to overpay the Vendor-1 for vehicle maintenance and repair, which Nguyen characterized as a  “raise.”  Between approximately January 2022 and February 2023, Nguyen used USPS credit cards to pay Vendor-1 approximately $1.1 million, approximately $260,000 of which was for legitimate maintenance and repair work.

The USPS lost approximately $843,271.32 though this scheme.

Lutz pleaded guilty to conspiracy to commit honest services wire, which carries a maximum term of imprisonment of 20 years.  Judge Underhill scheduled sentencing for May 16.

Lutz is released on bond pending sentencing.

On October 13, 2023, Nguyen pleaded guilty to one count of honest services wire fraud related to this scheme and also admitted that he embezzled more than $80,000 from the USPS by using his USPS credit cards to rent vehicles for the personal use of himself and others, and that he approved more than $8,000 in fraudulent travel expense reimbursement claims for a co-worker.

Nguyen is released on a $100,000 bond and residing in Massachusetts while awaiting sentencing.

This investigation is being conducted by the U.S. Postal Service, Office of Inspector General and the Federal Bureau of Investigation.  The case is being prosecuted by Assistant U.S. Attorney Jonathan N. Francis.

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