Three Federally Indicted, Accused Of Rigging Promo Bids To U.S. Army

Three men were indicted by a federal grand jury in the Middle District of Florida under charges of conspiring to rig bids for to the U.S. Army for customized promotional products. The indictment was unsealed Tuesday. Additionally, two of the three men are charged with conspiring to defraud the United States.

The Charges:

• The three men facing the charges are Lawrence O’Brien, Bruce LaRoche, and Thomas Dailey.

• In the most basic sense, rigging bids, as it applies to this situation, is the collusion of multiple parties to create a facade of market competition in an attempt to manipulate or fix a price.

• According to the indictment, LaRoche, Dailey and O’Brien exchanged their company’s bid templates and submitted bids to military customers on each other’s behalf in order to secure a pre-arranged winner.

• LaRoche is the owner of Venice, Florida-based Allegiance Tactical, which claims to distribute unique items to members of the U.S. Military. He is also accused of participating in a conspiracy to defraud the United States by creating shell companies that he and his co-conspirators would use to submit sham bids that appeared competitive despite the fact that LaRoche was the owner of all of them.

What authorities are saying:

• “Bid-rigging and fraud schemes targeting the military will not be tolerated–they are an affront to competition and the American taxpayer,” said Assistant Attorney General Jonathan Kanter of the Justice Department’s Antitrust Division. “Consistent with a whole-of-government approach, the Antitrust Division will continue working closely with our law enforcement partners and Procurement Collusion Strike Force to protect taxpayer funds from collusion and fraud.”

• “Bid rigging is not a victimless crime; it cheats taxpayers out of the benefits of competition,” said Special Agent Paul Wachsmuth, Director of the Office of Procurement Fraud Investigations, U.S. Air Force Office of Special Investigations (OSI), Joint Base Anacostia-Bolling, D.C. “OSI is committed to working with Antitrust Division and our law enforcement partners to hold companies and individuals accountable for practices that erode public trust and confidence in the government’s acquisition process.”

What it means:

• The charges place all three men in violation of the Sherman Antitrust Act, which carries a maximum penalty of 10 years in prison and a $1 million fine. LaRoche and O’Brien’s charges of defrauding the United States carry a maximum penalty of five years in prison and a $250,000 fine.

• The Procurement Collision Strike Force was created by the Justice Department in 2019 specifically to combat antitrust crimes and related fraudulent schemes that impact government procurement, grant and program funding at all levels of government.

• Whether the victim is an entity of the government or a standard U.S. business, bid rigging is not tolerated and can be prosecuted under the Sherman Antitrust Act.