BUFFALO, N.Y.–U.S. Attorney Michael DiGiacomo announced today that Advanced Global Services, Ltd. (AGS), Paradigm Shift Technologies (PST), and Gennady Yumshtyk (collectively, the defendants) have agreed to pay $223,618 to resolve allegations, arising under the False Claims Act (FCA), that they submitted false claims in connection with a Small Business Innovation Research (SBIR) program award funded by the United States Air Force and the United States Navy.The government alleges that in 2019, AGS obtained an SBIR award to develop certain gun barrel coating technology through the Air Force. To obtain the SBIR award, AGS and its president, Yumshtyk, certified, among other things, that AGS would conduct all research and development in connection with the SBIR award and that it would do so in the United States.
The government further alleges that AGS, which was located in Orchard Park, NY, did not, in fact, perform work under the SBIR award. Rather, PST, which is located in Toronto, Canada, performed the SBIR award work out of its Canadian facility. Accordingly, the United States contends that the defendants were not eligible to participate, and receive funding through, the SBIR program. “This Office is committed to holding accountable companies and individuals that misrepresent themselves so that they can participate in important government programs, like SBIR,” said U.S.
Attorney DiGiacomo.“Protecting the integrity of the federal procurement process is a top priority for the Air Force Office of Special Investigations,” said Special Agent-in-Charge Sandy Nezi, Air Force Office of Special Investigations. “When contractors misrepresent their eligibility and location of work to secure taxpayer funds, they undermine programs designed to support genuine American small businesses. We will continue to work with our partners to aggressively investigate and hold accountable those who attempt to defraud the Department of the Air Force.”“Schemes that exploit taxpayer funds designated for domestic military innovation do more than violate public trust, they threaten the integrity of our procurement system and undermine our technological edge,” said Special Agent-in-Charge Greg Gross, Economic Crimes Field Office, Naval Criminal Investigative Service. “Alongside our federal partners and the Department of Justice, NCIS will relentlessly pursue those who misrepresent their eligibility to secure research funding meant to deliver advanced, secure capabilities to our warfighters.”The civil settlement resolves allegations brought by the United States in a civil complaint filed on November 24, 2025 in the United States District Court for the Western District of New York, captioned United States v.
Advanced Global Systems, Ltd., Paradigm Shift Technologies, Inc., and Gennady Yumshtyk, No. 1:25-cv-01248.The case was investigated at the direction of Special Agent Sandy Nezi, Air Force Office of Special Investigations, Office of Procurement Fraud; Special Agent, Oran Cape, Naval Criminal Investigative Service, Economic Crimes Field Office; and Assistant U.S. Attorney David M. Coriell and Investigator Peggy McFarland of the United States Attorney’s Office for the Western District of New York. The claims resolved by the settlement are allegations only; there has been no determination or admission of liability.# # # #