Two former Bata Shoe Co. officials have been charged with federal Anti-Kickback Act violations tied to a longtime scheme in which they allegedly raked off money from a U.S. Defense Department contract.
Zdenek Formanek, of Aberdeen, now a salesman for Bell Container Corp. in Newark, N.J., was indicted yesterday by a federal grand jury in Baltimore on one count of paying kickbacks to Bata's former purchasing manager, Alvin Grieninger.
Grieninger, of Havre de Grace, was charged in a related criminal information document with soliciting $37,653 from Bell and other contract suppliers from 1985 to late 1989. Court papers said Grieninger received about $11,150 of that amount for "favorable treatment" in steering business to certain subcontractors on Bata's defense contracts.
The criminal information also charged Bell Container and Kurt Faulhammer with one count each of paying kickbacks to Grieninger. Faulhammer, of Gansevoort, N.Y., is owner and president of K&R Knitting Inc., a Wilbraham, Mass., textile mill.
According to information from sources and papers filed in U.S. District Court in Baltimore, Bell Container paid the kickbacks to Grieninger through Formanek for defense contract business that Formanek obtained from Bata.
Bell made cardboard boxes, called "military cases," which were used to ship $90-a-pair cold weather military boots that Bata makes for the Defense Department.
Assistant U.S. Attorney William K. Meyer, who obtained the indictment and filed the criminal information, said Bell paid Formanek a 7 percent commission on Bata business he brought the box maker. Formanek kept 5 percent for himself and allegedly paid Grieninger kickbacks which amounted to 2 percent of that business.
Faulhammer, court papers say, also was a subcontractor on Bata's boot contract.
Bata apparently was an innocent victim of the alleged kickback schemes.
Sources said that Formaek, who retired several years ago as Bata's purchasing manager, had been involved in similar kickback schemes with the company's subcontractors for nearly two decades but he could not be prosecuted for that activity because it preceded the Anti-Kickback Act, which was enacted in 1986.
Meyer declined to comment on that allegation.
Grieninger was laid off from Bata Shoe Co. a few months ago after more than 30 years with the company. The layoff was not related to his alleged criminal activity, sources said.
The filing of a criminal information, rather than an indictment, usually means that the defendants named in it have agreed to plead guilty to the charges.