Final month, the Division of Justice (DOJ) introduced {that a} Florida grand jury indicted three males for conspiring to rig bids for personalized promotional merchandise to the U.S. Army and charged two of them with conspiring to defraud america. Bid rigging is how conspiring opponents successfully increase costs the place purchasers — typically federal, state, or native governments — purchase items or providers by soliciting competing bids.
In line with the indictment, Lawrence O’Brien, Bruce LaRoche and Thomas Dailey every personal corporations that promote promotional merchandise to the Army, similar to backpacks, water bottles, hats and knives, which characteristic the logos and insignias of army items. The Army considers these purchases vital to its recruitment and retention of service members.
The indictment alleges that between July 2014 and December 2019, the three males conspired to remove competitors amongst their corporations by sharing their bids, pre-arranging the winner, and submitting bids on one another’s behalf. The indictment additionally alleges that O’Brien and LaRoche defrauded the federal government by establishing shell corporations to submit sham bids to make the procurement course of appear aggressive.
All three males are charged with violating Part 1 of the Sherman Act, which bars unreasonable agreements to restrain commerce. The utmost penalty for that cost is ten years in jail and a $1 million legal positive. LaRoche and O’Brien additionally face separate expenses of conspiracy to defraud america, which carry a most penalty of 5 years in jail and a $250,000 legal positive.
Assistant Lawyer Basic Jonathan Kanter, head of the DOJ’s Antitrust Division, famous that the case is a part of an ongoing inter-agency effort referred to as the Procurement Collusion Strike Drive (PCSF) geared toward combating antitrust crimes and associated fraudulent schemes that impression authorities procurement in any respect ranges of presidency. Launched in 2019 and expanded in fall 2020, the PCSF is comprised of the Antitrust Division of the DOJ, a number of U.S. Attorneys’ Workplaces across the nation, the Federal Bureau of Investigation, and the Inspectors Basic for quite a few federal businesses.
“Bid-rigging and fraud schemes focusing on the army is not going to be tolerated — they’re an affront to competitors and the American taxpayer,” Kanter stated in a DOJ assertion. “According to a whole-of-government method, the Antitrust Division will proceed working intently with our legislation enforcement companions and Procurement Collusion Strike Drive to guard taxpayer funds from collusion and fraud.”
The indictment highlights DOJ’s continued enforcement efforts on authorities contractors amid heightened antitrust focus.
The writer wish to thank our legislation clerk Allison Moors for her worthwhile contributions to this text.
