A Fredericksburg, Va., woman and an American businessman living in El Salvador pleaded guilty yesterday in Alexandria to conspiracy for their roles in selling defective ammunition to the Salvadoran Army under a $4.8 million Pentagon-financed contract.
Darlene R. Straiton, 40, and John P. Fodor, 52, were accused of substituting Yugoslavian ammunition for American bullets in the 1983 transaction, which included illegal payments of almost $300,000 to two top Salvadoran Army officials instrumental in arranging the contract.
Straiton and Fodor could be sentenced to up to five years in prison and fined $10,000. U.S. District Judge Claude M. Hilton, who set sentencing for Sept. 19, dismissed 25 other charges at the government's request.
On Monday, Straiton's former husband, John P. Straiton IV, pleaded guilty to conspiracy in connection with the same contract. He was president of the defunct Nordac Manufacturing Corp. of Fredericksburg, a military supplies firm that held the ammunition contract.
Assistant U.S. Attorney Theodore S. Greenberg told the court yesterday that Fodor received nearly $290,000 from the Straitons, most of which he gave to Salvadoran Army Col. Jorge Rivera, chief of the finance department of the Salvadoran Ministry of Defense. Some of the money went to Col. Elmer Gonzalez Araujo, president of the Salvadoran Buying Commission, Greenberg said.
Fodor is married to Rivera's niece and jointly owns a dry goods store with Rivera's sister. Acting as the Straitons' "agent" he "made it clear . . . he is taking care of Salvadoran officials and that is how Straiton was able to get contracts," Greenberg said.
The contract, financed by the Pentagon's foreign military assistance program, prohibited commissions in excess of $50,000.
Fodor's attorney, Jack S. Rhoades, said that "none of the money" Fodor received from the Straitons "went for any bribes" and that none was given to Col. Rivera. The money was used in Fodor's business, Rhoades said.
His client also had "no knowledge the ammunition was from Yugoslavia" and learned about this when reports appeared in newspapers in Fredericksburg, Rhoades said.
Greenberg said Darlene Straiton traveled to Yugoslavia to purchase 18 million rounds of the ammunition, which she and her husband then shipped to the United States, repackaged, and sent to El Salvador, telling U.S. officials it was American-made, as the contract required.
Salvadoran officials soon began complaining that their M16 automatic rifles were jamming because the ammunition was defective. U.S. officials began an investigation, which led to the charges against the Straitons and Fodor.
Since the Yugoslavian ammunition was cheaper than American-made ammunition, the Straitons made a $1.2 million profit on the contract, Greenberg said. They also earned $200,000 in illegal interest on advances from the Pentagon under the contract.
Greenberg said Fodor received a total of $636,213 from the Straitons from January 1983 to July 1984 as commissions for various contracts obtained by Nordac in El Salvador. Of that amount, $275,000 went to bank accounts in this country held by Rivera family members, the prosecutor said.