Scott G. Srodes, a former employee of a shelving and storage distributor, pleaded guilty on June 2 to two felonies for conspiring to rig bids and defraud the U.S. Department of War in connection with contracts for the U.S. Air Force. The charges stem from collusive bidding on shelving and storage products used at multiple healthcare and operations facilities.
According to court documents filed in the Middle District of Georgia, Srodes, 65, of Las Vegas, Nevada, worked with co-conspirators to submit coordinated bids for projects at Moody Air Force Base in Valdosta, Georgia, and Nellis Air Force Base in Las Vegas. The group exchanged pricing information before submitting their bids and sometimes instructed each other on what prices to quote. The affected projects had a combined value exceeding $1.8 million and were funded through the Defense Logistics Agency’s Facilities Maintenance, Repair, and Operations Program.
“This additional guilty plea reflects the scope of this investigation and the consequences awaiting those who conspire to defraud defense contracting programs. DCIS and our law enforcement partners will continue to pursue every individual and company responsible for defrauding the programs that support our nation’s military,” said Special Agent in Charge Jason Sargenski of the Department of Defense Office of Inspector General, Defense Criminal Investigative Service Southeast Field Office.
The case was investigated by several agencies including the Antitrust Division’s Washington Criminal Section; Air Force Office of Special Investigations; Defense Criminal Investigative Service; and Defense Logistics Agency Office of Inspector General. Trial Attorneys Daniel P. Chung and Christian Neumeister are prosecuting with assistance from the U.S. Attorney’s Office for the Middle District of Georgia.
The maximum penalty for conspiracy to rig bids under federal law is 10 years imprisonment plus a $1 million fine per individual count; conspiracy to defraud carries up to five years imprisonment or a $250,000 fine per count. Fines may be increased depending on gains or losses related to these crimes if they exceed statutory limits.
The Justice Department serves as the principal federal agency for law enforcement with more than 115,000 employees operating across all states as well as internationally in over 50 countries, according to its official website. Garland assumed leadership as Attorney General in March 2021 after overseeing major prosecutions during his tenure.