Ohio company pleads guilty to rigging bids, defrauding NC Department of Transportation
An Ohio-based company has pleaded guilty to conspiring to rig bids and defraud the N.C. Department of Transportation, federal prosecutors announced.
Contech Engineered Solutions of suburban Cincinnati agreed to pay a criminal fine of $7 million and pay $1,533,988 in restitution to NCDOT. The agreement, reached in May and announced late Monday, settles an indictment brought by a federal grand jury in Raleigh last fall.
Prosecutors accused Contech and a former executive, Brent Brewbaker, of sharing bid information with a competitor on several occasions between 2009 and 2018. The two companies were ostensibly competing to provide aluminum drainage structures for roads and bridges.
According to prosecutors, Brewbaker and others at Contech would contact the would-be competitor, identified as “Company A” in the indictment, to find out what it planned to bid on each NCDOT project. Contech would then intentionally bid higher, giving Company A an advantage, the indictment said.
But when Company A won an NCDOT contract, Contech also benefited, because “it supplied aluminum pieces to Company A for use in those projects,” according to the indictment.
The bids included signed documents certifying, falsely, that they were made “competitively and without collusion,” according to the indictment. Company A, which is identified as a “co-conspirator” in the indictment, was not charged by the grand jury. Two of the company’s former employees are listed as both co-conspirators and cooperating witnesses.
The agreement settles the case against Contech, which faced a criminal fine of up to $100 million for the bid-rigging charge, which violates the Sherman Antitrust Act, according to prosecutors. They say the case against Brewbaker remains unresolved.
In a statement, Contech took responsibility for its part in the conspiracy.
“While the charges arose from the conduct and direction principally of a former employee in North Carolina, we take antitrust laws very seriously and we accept responsibility for that person’s conduct,” the company said. “Since the DOJ informed us of their investigation, we have cooperated fully with the investigators and have taken numerous measures to prevent the recurrence of this sort of conduct. We remain focused on serving our customers consistently with our commitment to integrity and ethics in all our dealings.”
NCDOT had no comment on the settlement, according to a spokesman. The News & Observer is trying to reach Brewbaker for comment.
When the Justice Department announced the indictment last fall, it said it was the result of “an ongoing federal antitrust investigation into bid rigging and other criminal conduct in the aluminum structures industry.” Among those involved in the investigation were the U.S. Attorney’s Office for the Eastern District of North Carolina, the U.S. Postal Service and the U.S. Department of Transportation, which provides money for many NCDOT highway projects.
“The agreement and sentence imposed should serve as a significant deterrent for anyone who chooses corporate greed over open and fair competition in transportation projects funded with federal dollars,” Jamie Mazzone, an agent with the USDOT’s Office of Inspector General, said in a statement Monday. “Together with our law enforcement and prosecutorial partners, we will continue our efforts to pursue and uncover corrupt conduct and hold these bad actors accountable.”
