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LA Attorney’s Office To Combat Antitrust Crimes and Schemes in Government Procurement, Grant and Program Funding

Department of Justice

LOS ANGELES – The Justice Department has announced the formation of the Procurement Collusion Strike Force (PCSF) that will focus on deterring, detecting, investigating and prosecuting antitrust crimes – such as bid-rigging conspiracies and related fraudulent schemes – which undermine competition in government procurement, grant and program funding. The United States Attorney’s Office for the Central District of California will be among participants on the PCSF.

In making the announcement on Tuesday, Justice Department officials said the PCSF will be an interagency partnership consisting of prosecutors from the Antitrust Division, prosecutors from 13 U.S. Attorneys’ Offices, and investigators from the FBI, the Department of Defense Office of Inspector General, the U.S. Postal Service Office of Inspector General and other partner federal Offices of Inspector General.

“I am proud that my office will participate in the new Strike Force and will play a role in ensuring that taxpayer money being paid to contractors will be protected from bid-rigging and other anti-competitive schemes,” said United States Attorney Nick Hanna.

The PCSF will lead a national effort to protect taxpayer-funded projects at the federal, state and local level from antitrust violations and related crimes, starting with a focus on 13 districts throughout the country. Prosecutors from the Antitrust Division and the participating U.S. Attorneys’ Offices, along with agents from the FBI and partner Offices of Inspector General, will work together to conduct outreach and training for procurement officials and government contractors on antitrust risks in the procurement process. In addition, prosecutors and investigators will jointly investigate and prosecute cases that result from their targeted outreach efforts.

            “To protect taxpayer dollars, the Justice Department is doing its part to eliminate anticompetitive collusion, waste and abuse from government procurement,” said Deputy Attorney General Jeffrey A. Rosen. “To ensure taxpayers the full benefits of competitive bidding, experienced investigators and prosecutors with the necessary expertise will partner in this Strike Force to deter, detect and prosecute antitrust crimes and related schemes in government procurements.”

“The investigation and prosecution of individuals and organizations that cheat, collude and seek to undermine the integrity of government procurement are priorities for this administration,” said Assistant Attorney General Makan Delrahim of the Justice Department’s Antitrust Division. “The PCSF will train and educate procurement officials nationwide to recognize and report suspicious conduct in procurement, grant and program funding processes.  We will aggressively investigate and prosecute those who violate our antitrust laws to cheat the American taxpayer.”

The Antitrust Division and its law enforcement partners have a history of prosecuting criminal antitrust conspiracies that take advantage of government contracts.  In late 2018 and early 2019, for instance, five South Korean oil companies agreed to plead guilty for their involvement in a decade-long bid-rigging conspiracy that targeted contracts to supply fuel to U.S. military bases in South Korea. The Antitrust Division also indicted seven individuals for conspiring to rig bids and to defraud the government, and one executive was also charged with obstruction of justice. In total, the companies have agreed to pay $156 million in criminal fines and over $205 million in separate civil settlements. This year, the Justice Department, in partnership with the GSA Office of Inspector General, also indicted individuals for involvement in rigging bids submitted to the GSA.

The PCSF’s investigative partners include the Department of Defense, Office of Inspector General; the Federal Bureau of Investigation; the General Services Administration, Office of Inspector General; the Department of Justice, Office of the Inspector General; and the U.S. Postal Service, Office of Inspector General.

            The PCSF has launched a publicly available website at https://www.justice.gov/procurement-collusion-strike-force, where government procurement officials and members of the public can review information about the federal antitrust laws and training programs, and report suspected criminal activity affecting public procurement.

            Individuals and companies are encouraged to contact the PCSF if they have information concerning anticompetitive conduct involving federal taxpayer dollars by emailing pcsf@usdoj.gov.

            Release No. 19-229

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