In a shocking turn of events, four key figures in the erosion control industry, including company owners and managers, have pleaded guilty to charges of bid rigging and price fixing.
Their illicit activities targeted publicly funded transportation construction contracts across Oklahoma, totaling over $100 million. The guilty parties involved are Stanley Mark Smith, Roy Henry Henrich, Ryan Ashley Sullivan, and James Travis Feazel.
This expose delves into the details of their criminal conspiracy, the impact on public infrastructure, and the legal consequences they now face.
Conspiracy Unveiled:
As revealed in court documents filed in the U.S. District Court in Oklahoma City, the quartet conspired with others to rig bids, fix prices, and allocate contracts for erosion control products and services.
Commencing in 2017, Smith, Henrich, Sullivan, Feazel, and their co-conspirators agreed to raise prices and allocate contracts across different areas of Oklahoma.
The modus operandi included submitting intentionally high-priced bids or outright refusing to bid, manipulating the competitive landscape.
Individual Involvement and Timeline:
Stanley Mark Smith, the owner of one of the companies, pleaded guilty today. Roy Henry Henrich, a former owner and officer, pleaded guilty on Dec. 4, 2023.
Ryan Ashley Sullivan, an owner and executive of another company, pleaded guilty on Nov. 6, 2023. James Travis Feazel, a former operations manager, pleaded guilty on Sept. 26, 2023.
Shockingly, the conspiracy extended well into recent years, with Smith’s and Feazel’s companies targeting contracts until April 2023.
Scope of the Conspiracy:
According to court documents, Smith’s company targeted over $42 million worth of contracts, while Feazel’s company aimed for contracts exceeding $50 million.
Henrich, associated with contracts surpassing $7 million, was part of the conspiracy until at least July 2021. Sullivan, involved in contracts worth millions, participated in the conspiracy until at least April 2019.
The scale of their activities underscores the breadth of the erosion control conspiracy.
Significance of Public Infrastructure:
“In Oklahoma and across the United States, Americans depend on transportation infrastructure as they travel to work, study, shop and visit family,” remarked Assistant Attorney General Jonathan Kanter of the Justice Department’s Antitrust Division.
This emphasizes the critical role of fair and open competition in securing public contracts that fund essential infrastructure projects.
The guilty pleas highlight the commitment to safeguarding the integrity of the bidding process for such projects.
Legal Consequences and Accountability:
The defendants each pleaded guilty to a violation of Section 1 of the Sherman Act, facing a maximum penalty of 10 years in prison and a $1 million criminal fine.
The fines may be increased based on the gains derived from the crime or the losses suffered by the victims.
U.S. Attorney Robert J. Troester for the Western District of Oklahoma emphasized holding corporate executives accountable for bid rigging and price fixing, applauding the detailed work of investigators and prosecutors.
Government Agencies’ Response:
The Department of Transportation Office of Inspector General (DOT-OIG) and the FBI Oklahoma City Field Office played pivotal roles in investigating the case.
Special Agent in Charge Joseph Harris of DOT-OIG’s Southern Region highlighted their commitment to identifying and thoroughly investigating any activity related to price-fixing or bid-rigging involving federal taxpayer dollars.
The FBI expressed its dedication to eliminating bid rigging and price fixing, emphasizing the impact on American workers and consumers.
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