Defense contractor pleads guilty to rigging bids on military contracts

According to the Department of Justice, Ransom Soper III, a former employee at West Sayville, N.Y.-based Peck & Hale LLC, pleaded guilty in a federal court to one charge of bid rigging and one charge of conspiring to commit wire fraud.

Under the plea agreement, which is subject to court approval, Soper has agreed to cooperate with the Justice Department’s ongoing investigation. Soper’s sentence will be determined by the court.

Soper participated in the bid-rigging conspiracy from January 2002 through December 2004. Soper and his co-conspirators agreed not to compete on contracts for Navy straps sold to the U.S. Department of Defense.

In addition, Soper participated in a conspiracy to commit wire fraud and deprive Peck & Hale of its right to honest services of its employees from May 2002 through January 2005. As part of the scheme, Soper and a co-conspirator were paid more than $140,000 in kickbacks in exchange for selecting a third co-conspirator’s company as Peck & Hale’s exclusive West Coast distributor.

 “Those who rig bids for military contracts defraud the United States and deny the American public the benefits afforded by a competitive bidding process,” said Thomas Barnett, assistant attorney general in charge of the Justice Department’s Antitrust Division. “These charges serve as a reminder that we will vigorously prosecute such conduct.”

Soper faces up to 10 years, $1 million fine

According to the Justice Department, Soper is charged with carrying out the conspiracy with co-conspirators by:

• Engaging in discussions regarding the sale of Navy straps to the Defense Department.
  
• Agreeing during those discussions not to compete on certain Defense Department contracts by not submitting prices or bids on those contracts.
  
• Submitting bids in accordance with the agreements reached.
  
• Selling Navy straps to the Defense Department under those agreements at collusive and non-competitive prices.
  
• Accepting payments for Navy straps sold at collusive and noncompetitive prices.
  

Soper is charged with bid rigging in violation of the Sherman Act, which carries a maximum sentence of 10 years imprisonment and a fine of $1 million for individuals. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.

According to the Justice Department, the case is the seventh to arise from an ongoing investigation into the military restraints industry, and Soper is the second Peck & Hale employee to plead guilty to bid-rigging charges this year.