another falls in DWP

an ex-LADWP executive will plead guilty to lying to the FBI over agreeing to accept a job in exchange for pushing a contract for a fake cyber security company.

As a source told me recently regarding the government’s long-awaited movement in DWP over the past few weeks: “I’m going to start believing Santa Claus is real.”

Now the third figure in the expanding DWP saga has agreed to plead guilty to criminal charges. This time, a former Los Angeles Department of Water and Power (LADWP) executive, David F. Alexander, has agreed to plead guilty to lying to the FBI. Alexander will admit he lied to investigators about asking for a job from a company whose contract he pushed for approval, according to prosecutors.

Alexander was LADWP’s chief information security officer for about two years, and then its chief cyber risk officer for a brief period. He faces a maximum of five years in jail.

According to his plea agreement, Alexander formed a close relationship with Paul Paradis, who created a cyber security company called Aventador Utility Solutions, and had scored a $30 million no-bid contract from the DWP board to perform work on DWP’s bad billing system. Paradis had also represented both sides of a lawsuit over DWP billing, according to the government. He has agreed to plead guilty to bribery.

The agreement sheds light on why DWP officials continued to steer lucrative municipal contracts to Paradis’ company amidst negative press reports and while knowing he was no longer supposed to be involved with the company.

By March 2019, Paradis had apparently sold Aventador to an employee and changed its name to Ardent Cyber Solutions, the government said, following reports about the no-bid contracts. Paradis was supposed to have no financial interest over the new company.

The government said Alexander drafted a Request For Proposal (RFP) for a cyber security services contract in his capacity as a member of the Southern California Public Power Authority (SCPPA) – a collective of municipal utilities, including LADWP, the government said. The contract was requested by LADWP’s then-general manager, David H. Wright, who has agreed to plead guilty to taking a bribe from Paradis.

“Alexander knew the SCPPA RFP process was intended to be a competitive, neutral and transparent process. But he manipulated that process with the goal of securing future cybersecurity work for Aventador, and, later, Ardent,” according to a statement Monday evening by the U.S. Attorney’s office in Los Angeles.

The government said from late February 2019 to April 2019, Alexander used his position as the LADWP chief cyber risk officer and the vice-chair of the SCPPA’s Cyber Security Working Group to gain favor for Ardent. This involved persuading other members of the committee to score Ardent favorably, the government said.

On April 5, 2019, the SCPPA Cybersecurity Working Group informed Ardent that it would recommend Ardent for the SCPPA contract. Later that same day, Alexander met with Paradis, who by that time was low-key cooperating with the FBI, prosecutors said.

“During that meeting, Alexander told Paradis that he had used the SCPPA bidding process to get LADWP’s “desired outcome,” that is, a contract with Ardent, but in a manner that falsely appeared “completely transparent.” Alexander also boasted that he was the one who had secured the contract for Ardent, informing Paradis, “that was me driving it,”’ according to the government.

In April 2019, the SCPPA Board approved a contract for Ardent and two other vendors valued at a total of approximately $17 million, prosecutors stated.

Further, in the summer of 2019, Alexander manipulated in Ardent’s favor an RFP process from LADWP for the award of a three-year, $82.5 million cybersecurity consulting services contract. Alexander allowed Paradis to edit the proposal, according to the government.

On July 9, 2019, just weeks before the FBI raid on DWP offices, Paradis told Alexander, via text message, that after he submitted the Ardent proposal, “it will be up to you to ‘manage’ the evaluators the same way you did for the SCPAA [sic] process so that we get the correct result... [winking face emoji].” Alexander responded via text message, “I know my job [crying-laughing emoji].”

Later that month, Alexander told Paradis that, in violation of his obligation to keep his scores strictly confidential, he provided his score sheet to two other evaluators to influence them to give Ardent a high score, according to prosecutors.

Then during this lunch meeting, Alexander informed Paradis that he was interested in working at Ardent as its business manager, prosecutors said.

By the end of that week, Alexander solicited and agreed to accept from Paradis a future job as the chief administrative officer of Ardent, a to-be-determined executive-level annual salary, a signing bonus, and recompense of $60,000 per year for 30 years for his early retirement penalty from LADWP, the government said.

“Alexander did so intending to be influenced and rewarded in connection with his ongoing assistance in securing the award of a multimillion-dollar LADWP contract to Ardent and use of his position to guarantee more than $10 million in future task orders for Ardent under the anticipated LADWP contract,” according to the government.

And Alexander wanted to keep working for DWP while having Ardent as his shadow employer. 

“Alexander also asked for a secret Ardent email address and laptop computer to communicate with Paradis and to secretly perform work for Ardent while he was employed at LADWP,” the government stated.

Following the FBI’s raid on DWP and the city attorney’s office, Alexander lied on two occasions to the FBI about his convos and agreements with Paradis. He falsely stated that he had declined any employment opportunity with Ardent and that he had never provided any guarantees to Ardent or to Paradis, according to the government.

Paradis has agreed to plead guilty to a bribery charge for accepting an illegal kickback of nearly $2.2 million for getting another attorney to purportedly represent his ratepayer client in a collusive lawsuit against LADWP. Paradis will make a court appearance Thursday.

Prosecutors working this case include Melissa Mills, Jamari Buxton and Susan Har of the Public Corruption and Civil Rights Section.