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Two convicted of fraud in SOCom contract

TAMPA — The two men were accused of ripping off the military. But nobody ever said they weren't good teachers while they did it.

A jury found Daniel Guillan and Eduardo Blanchet guilty Tuesday of defrauding the federal government by hiding their ties to a language-instruction company to get a $100 million contract with U.S. Special Operations Command.

SOCom, with headquarters at MacDill Air Force Base, is one of the commands that spearheaded the wars in Iraq and Afghanistan. The command directs the nation's special forces.

Guillan, 56, and Blanchet, 60, who live in the Orlando area, showed no reaction as the verdict was read in U.S. District Court, except for Blanchet absently twirling his eyeglasses in his left hand.

The pair was accused of forming a new company, then hiding their control of the business, to qualify for a SOCom contract set aside for a small business. Their previous company no longer qualified as one.

The convictions on conspiracy and wire fraud charges carry a penalty of up to 20 years in prison, though the men are unlikely to be sentenced to anything close to statutory maximums. A sentencing date has not been scheduled.

Both men, free on bail until sentencing, declined to comment after the verdict. A jury also ordered them to forfeit $9.4 million.

What set the case apart was that SOCom continued to use the services of Guillan and Blanchet's company, MiLanguages, even after an investigation opened.

And the government kept sending hefty checks because, defense lawyers said, SOCom was happy with MiLanguages services.

Prosecutor Josephine Thomas told jurors during a two-week trial that the services MiLanguages provided were never in question. The company, she said, did the job it was hired to do.

But in the defendants' success were the seeds of their downfall.

Blanchet owned B.I.B. Consulting, a company that in 2002 won a $50 million SOCom contract to provide language instruction to special forces like Navy SEALs and Green Berets. Guillan was vice president of B.I.B. and in charge of day-to-day operations.

That contract was set aside for a small business, which B.I.B. was at the time.

But success brought growth, and when B.I.B.'s contract expired in 2007, SOCom sought another small company for a new $100 million deal.

An indictment said Guillan and Blanchet formed MiLanguages, setting up a straw man as its president, "although Blanchet and Guillan remained the de facto owners."

The sham president of the company was paid $63,000 by Guillan and Blanchet, while they earned more than $12 million in illicit profit, prosecutors said.

Prosecutors said the men made false representations and submitted false information to the Small Business Administration to win designation as a small business.

In 2007, the men instructed an attorney to "send a letter to the SBA size program manager relaying that MiLanguages and B.I.B. had no common officers, shareholders or employees … and that a 'clear line of fracture' existed between B.I.B. and MiLanguages," an indictment said.

In reality, prosecutors said, the two men set up MiLanguages' bank accounts in which they were the only signatories.

Defense lawyers said payments made after the government's investigation opened were proof of innocence. They said the men simply relied on the advice of their attorney and other professionals and never sought to defraud SOCom.

Guillan and Blanchet, defense lawyers said in a joint motion, "were indicted for actions that were expressly approved by SOCom."

A SOCom spokesman could not be reached to comment.

Reach William R. Levesque at or (813) 226-3432.

Two convicted of fraud in SOCom contract 02/28/12 [Last modified: Tuesday, February 28, 2012 11:09pm]
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