Everyone in America knows that local governments and private contractors conspire to steal from the people on a regular basis. We all know it but seldom do these crimes see the light of day. The following case which is quoted from the Department of Justice web site shows in a very concrete way how such crimes are committed:
“WASHINGTON — A former president of an Illinois refuse disposal container repair company was sentenced today for his role in a conspiracy to commit mail and wire fraud in connection with bids on a contract for the repair of refuse carts for the city of Chicago, the Department of Justice announced today.
Douglas E. Ritter, an Illinois resident, was sentenced by U.S. District Court Judge Ruben Castillo to serve 16 months in prison and to pay $35,303 in restitution for his participation in a conspiracy to defraud the city of Chicago on a contract for the repair of refuse carts from as early as November 2004 to as late as September 2008. Ritter, along with his business partner Steven Fenzl, was charged in an indictment filed on April 21, 2009, in U.S. District Court in Chicago. Ritter pleaded guilty to the conspiracy on June 3, 2010. Fenzl, a California resident, was found guilty by a jury on Sept. 28, 2010, of one count of conspiracy to commit mail and wire fraud, two counts of mail fraud and one count of wire fraud. Fenzl is scheduled to be sentenced on June 15, 2011.
According to the indictment, Ritter, Fenzl and their co-conspirator conspired to deceive city of Chicago officials about the number of legitimate, competitive bids submitted for the contract. Specifically, Ritter and his co-conspirators fraudulently induced other companies to submit bids for the contract at prices determined by Ritter and his co-conspirators and greater than the price for which Ritter's company had submitted a bid. The department said that included in these bids were fraudulent documents indicating that, if awarded the contract, the bidder would enter into subcontracts to purchase goods or services for a specified percentage of the contract from a minority-owned business and a women-owned business, as required by the city of Chicago. According to the indictment, Ritter and his co-conspirators also fraudulently certified to the city on Ritter's company's bid that it had not entered an agreement with any other bidder relating to the price named in any other bid submitted to the city for the contract.
Today's sentencing resulted from an ongoing investigation of the refuse cart repair industry being conducted by the Antitrust Division's Chicago Field Office and the city of Chicago's Office of Inspector General.”
Anyone who believes that contracting out public services to private companies leads to free enterprise capitalism full of integrity and a devotion to looking out for the greater good, is not quite right in the head. Business is all about maximizing the profit of the individual no matter what he/she has to do or who he/she has to steal from. I was told when I was a young naive manager at a large retailer that in the world of business there is only one thing to know and that is "Everyone steals if they think they can get away with it".
Thursday, May 12, 2011
Sunday, May 8, 2011
DRUGS AND KICKBACKS: BIG PHARMA COMPANY GETS CAUGHT
The Securities and Exchange Commission has a giant pharmaceutical company with bribing doctors in Europe and paying kickbacks to Iraq. There was a lot of cooperation between various governments and agencies. The following is an excerpt from the SEC web site:
“Washington, D.C., April 7, 2011
The SEC alleges that since at least 1998, subsidiaries of the New Brunswick, N.J.-based pharmaceutical, consumer product, and medical device company paid bribes to public doctors in Greece who selected J&J surgical implants, public doctors and hospital administrators in Poland who awarded contracts to J&J, and public doctors in Romania to prescribe J&J pharmaceutical products. J&J subsidiaries also paid kickbacks to Iraq to obtain 19 contracts under the United Nations Oil for Food Program.
J&J agreed to settle the SEC’s charges by paying more than $48.6 million in disgorgement and prejudgment interest. J&J also agreed to pay a $21.4 million fine to settle parallel criminal charges announced by the U.S. Department of Justice (DOJ) today. A resolution of a related investigation by the United Kingdom Serious Fraud Office is anticipated.
“The message in this and the SEC’s other FCPA cases is plain – any competitive advantage gained through corruption is a mirage,” said Robert Khuzami, Director of the SEC's Division of Enforcement. “J&J chose profit margins over compliance with the law by acquiring a private company for the purpose of paying bribes, and using sham contracts, off-shore companies, and slush funds to cover its tracks.”
Cheryl J. Scarboro, Chief of the SEC Enforcement Division’s Foreign Corrupt Practices Act Unit, added, “Bribes to public doctors can have a detrimental effect on the public health care systems that potentially pay more for products procured through greed and corruption.”
According to the SEC’s complaint filed in federal court in the District of Columbia, public doctors and administrators in Greece, Poland, and Romania who ordered or prescribed J&J products were rewarded in a variety of ways, including with cash and inappropriate travel. J&J subsidiaries, employees and agents used slush funds, sham civil contracts with doctors, and off-shore companies in the Isle of Man to carry out the bribery.
Without admitting or denying the SEC’s allegations, J&J has consented to the entry of a court order permanently enjoining it from future violations of Sections 30A, 13(b)(2)(A), and 13(b)(2)(B) of the Securities Exchange Act of 1934; ordering it to pay $38,227,826 in disgorgement and $10,438,490 in prejudgment interest; and ordering it to comply with certain undertakings regarding its FCPA compliance program. J&J voluntarily disclosed some of the violations by its employees and conducted a thorough internal investigation to determine the scope of the bribery and other violations, including proactive investigations in more than a dozen countries by both its internal auditors and outside counsel. J&J’s internal investigation and its ongoing compliance programs were essential in gathering facts regarding the full extent of J&J’s FCPA violations.
. The SEC acknowledges the assistance of the U.S. Department of Justice, Fraud Section; Federal Bureau of Investigation; Serious Fraud Office in the United Kingdom; and 5th Investigation Department of the Regional Prosecutor’s Office in Radom, Poland. The SEC's investigation is continuing.”
In this case the company cooperated in the investigation. The defence in this case sounds like the "Enron Defence": Blame lower level employees to save the top executives. Of course in this case shareholders also loose out in taking a hit from both fines and ruining the reputation of the company. – The Securities and Exchange Commission today charged Johnson and Johnson (J&J) with violating the Foreign Corrupt Practices Act (FCPA) by bribing public doctors in several European countries and paying kickbacks to Iraq to illegally obtain business.
“Washington, D.C., April 7, 2011
The SEC alleges that since at least 1998, subsidiaries of the New Brunswick, N.J.-based pharmaceutical, consumer product, and medical device company paid bribes to public doctors in Greece who selected J&J surgical implants, public doctors and hospital administrators in Poland who awarded contracts to J&J, and public doctors in Romania to prescribe J&J pharmaceutical products. J&J subsidiaries also paid kickbacks to Iraq to obtain 19 contracts under the United Nations Oil for Food Program.
J&J agreed to settle the SEC’s charges by paying more than $48.6 million in disgorgement and prejudgment interest. J&J also agreed to pay a $21.4 million fine to settle parallel criminal charges announced by the U.S. Department of Justice (DOJ) today. A resolution of a related investigation by the United Kingdom Serious Fraud Office is anticipated.
“The message in this and the SEC’s other FCPA cases is plain – any competitive advantage gained through corruption is a mirage,” said Robert Khuzami, Director of the SEC's Division of Enforcement. “J&J chose profit margins over compliance with the law by acquiring a private company for the purpose of paying bribes, and using sham contracts, off-shore companies, and slush funds to cover its tracks.”
Cheryl J. Scarboro, Chief of the SEC Enforcement Division’s Foreign Corrupt Practices Act Unit, added, “Bribes to public doctors can have a detrimental effect on the public health care systems that potentially pay more for products procured through greed and corruption.”
According to the SEC’s complaint filed in federal court in the District of Columbia, public doctors and administrators in Greece, Poland, and Romania who ordered or prescribed J&J products were rewarded in a variety of ways, including with cash and inappropriate travel. J&J subsidiaries, employees and agents used slush funds, sham civil contracts with doctors, and off-shore companies in the Isle of Man to carry out the bribery.
Without admitting or denying the SEC’s allegations, J&J has consented to the entry of a court order permanently enjoining it from future violations of Sections 30A, 13(b)(2)(A), and 13(b)(2)(B) of the Securities Exchange Act of 1934; ordering it to pay $38,227,826 in disgorgement and $10,438,490 in prejudgment interest; and ordering it to comply with certain undertakings regarding its FCPA compliance program. J&J voluntarily disclosed some of the violations by its employees and conducted a thorough internal investigation to determine the scope of the bribery and other violations, including proactive investigations in more than a dozen countries by both its internal auditors and outside counsel. J&J’s internal investigation and its ongoing compliance programs were essential in gathering facts regarding the full extent of J&J’s FCPA violations.
. The SEC acknowledges the assistance of the U.S. Department of Justice, Fraud Section; Federal Bureau of Investigation; Serious Fraud Office in the United Kingdom; and 5th Investigation Department of the Regional Prosecutor’s Office in Radom, Poland. The SEC's investigation is continuing.”
In this case the company cooperated in the investigation. The defence in this case sounds like the "Enron Defence": Blame lower level employees to save the top executives. Of course in this case shareholders also loose out in taking a hit from both fines and ruining the reputation of the company. – The Securities and Exchange Commission today charged Johnson and Johnson (J&J) with violating the Foreign Corrupt Practices Act (FCPA) by bribing public doctors in several European countries and paying kickbacks to Iraq to illegally obtain business.
Sunday, May 1, 2011
TO GASOLINE FRAUDSTERS: THE GOVERNMENT WILL BE WATCHING YOU!
President Obama has said that speculation is one reason the price of oil is rising. In the following excerpt from the Department of Justice Web site, The U.S. Attorney General indicates that he has a plan to fight fraud and price manipulation of the commodities of gasoline and oil:
" The following post appears courtesy of Attorney General Eric Holder
Over the past few years, American businesses and families across the country have suffered the effects of the worst financial crisis in generations. Today, although our economic recovery is gaining steam, it remains critically important that we continue to use every available tool and resource to safeguard consumers against additional – and unnecessary – financial burdens.
For many, rapidly rising gasoline prices pose a serious concern. And while some factors – like regional variations and other lawful reasons for increased prices – may be beyond our control, it is imperative that we take action to identify and address potential cases of fraud and manipulation that may harm families and businesses.
Yesterday, I announced the formation of an Oil and Gas Price Fraud Working Group to help identify civil or criminal violations in the oil and gasoline markets, and to ensure that American consumers are not harmed by unlawful conduct. Since last month, at President Obama’s request, I have been directing efforts to increase cooperation between the Department of Justice and other groups with relevant authority, including federal agencies and state attorneys general. I am proud to say that this Working Group will enable us to formalize these partnerships, share monitoring information, and exchange ideas about what works – and what doesn’t work – at the state and federal level.
It will foster increased cooperation between investigators and government officials, so we can vigorously enforce state and federal laws against collusion, manipulation and other forms of wrongdoing. It will also allow us to evaluate significant market developments, including the activities of speculators and index traders, so we can anticipate and aggressively pursue cases of suspected illegal activity.
We’ve already proven that this kind of approach can be effective. Our new Working Group will report to me through the Financial Fraud Enforcement Task Force (FFETF), a partnership formed in late 2009 between agencies, regulators, state attorneys general, and local law enforcement organizations, which has already brought a powerful array of tools to the fight against financial fraud. By building on this work, the Justice Department and its partners can help promote a competitive and fraud-free marketplace – and can do so both efficiently and effectively.
As we work to determine if any laws have been violated and, if so, to swiftly bring those wrongdoers to justice, I am confident that the new Oil and Gas Price Fraud Working Group will help protect American consumers from unnecessary pain at the pump due to illegal activity. My colleagues and I at the Justice Department and across the administration are committed to stopping criminals who would take advantage of others for personal gain."
It sounds like the Attorney General is doing something positive that might ferret out some really bad and illegal behaviors conducted by speculators and energy businessmen.
" The following post appears courtesy of Attorney General Eric Holder
Over the past few years, American businesses and families across the country have suffered the effects of the worst financial crisis in generations. Today, although our economic recovery is gaining steam, it remains critically important that we continue to use every available tool and resource to safeguard consumers against additional – and unnecessary – financial burdens.
For many, rapidly rising gasoline prices pose a serious concern. And while some factors – like regional variations and other lawful reasons for increased prices – may be beyond our control, it is imperative that we take action to identify and address potential cases of fraud and manipulation that may harm families and businesses.
Yesterday, I announced the formation of an Oil and Gas Price Fraud Working Group to help identify civil or criminal violations in the oil and gasoline markets, and to ensure that American consumers are not harmed by unlawful conduct. Since last month, at President Obama’s request, I have been directing efforts to increase cooperation between the Department of Justice and other groups with relevant authority, including federal agencies and state attorneys general. I am proud to say that this Working Group will enable us to formalize these partnerships, share monitoring information, and exchange ideas about what works – and what doesn’t work – at the state and federal level.
It will foster increased cooperation between investigators and government officials, so we can vigorously enforce state and federal laws against collusion, manipulation and other forms of wrongdoing. It will also allow us to evaluate significant market developments, including the activities of speculators and index traders, so we can anticipate and aggressively pursue cases of suspected illegal activity.
We’ve already proven that this kind of approach can be effective. Our new Working Group will report to me through the Financial Fraud Enforcement Task Force (FFETF), a partnership formed in late 2009 between agencies, regulators, state attorneys general, and local law enforcement organizations, which has already brought a powerful array of tools to the fight against financial fraud. By building on this work, the Justice Department and its partners can help promote a competitive and fraud-free marketplace – and can do so both efficiently and effectively.
As we work to determine if any laws have been violated and, if so, to swiftly bring those wrongdoers to justice, I am confident that the new Oil and Gas Price Fraud Working Group will help protect American consumers from unnecessary pain at the pump due to illegal activity. My colleagues and I at the Justice Department and across the administration are committed to stopping criminals who would take advantage of others for personal gain."
It sounds like the Attorney General is doing something positive that might ferret out some really bad and illegal behaviors conducted by speculators and energy businessmen.
Saturday, April 30, 2011
WHITE HOUSE E-MAIL ON REDUCING OIL PRICES
The following is an e-mail sent out by the White House on April 29, 2011. In it the White House outlined some steps being taken to end fraud, subsidies and energy dependence on foreign sources. It is a short read and an excerpt from a longer e-mail which included a video:
"A few weeks ago, I emailed you about rising gas prices, and I want to give you a quick update on three important steps:
Sincerely,
David Plouffe
Senior Advisor to the President"
"A few weeks ago, I emailed you about rising gas prices, and I want to give you a quick update on three important steps:
- Ending oil and gas subsidies. Oil companies are receiving $4 billion a year in taxpayer subsidies that don't make sense and that we can't afford. That's why President Obama has called on Democrats and Republicans in Congress to stop subsidizing the oil and gas industry so that we can afford to invest in the clean energy economy of tomorrow.
- Stopping oil market fraud. Last week, Attorney General Eric Holder announced a working group focused on rooting out the cases of fraud in the oil markets that might affect gas prices (the President discussed this in his Weekly Address last Saturday).
- Reducing our dependence on oil. Stepping back to look at the bigger picture, President Obama recently unveiled his Blueprint for a Secure Energy Future that set a goal of reducing our imports of foreign oil by a third in a little over a decade. To do this we have to increase our domestic energy production, reduce our demand for oil by building cleaner, more efficient vehicles, and fully utilize alternatives to oil in the transportation sector like natural gas and advanced biofuels.
Sincerely,
David Plouffe
Senior Advisor to the President"
Thursday, April 21, 2011
FDA ACCUSES FIRMS OF MAIKNG UNPROVED CLAIMS REGARDING HAND SANITIZERS
The following is an excerpt from the FDA web site. According to the FDA various manufacturers were making claims that their product prevented infections from certain bacteria when the FDA did not have the evidence to back up the claims :
" The U.S. Food and Drug Administration issued four warning letters to companies that manufacture and market over-the-counter (OTC) drug products, including hand sanitizers, that claim to prevent infection from methicillin-resistant Staphylococcus aureus bacteria (MRSA).
Labeling and marketing materials for the affected products also claim that they can prevent infection from other disease-causing agents. In addition, the labeling of some of the firms’ hand sanitizing drug products make claims related to preventing infection from E.coli and/or H1N1 flu virus. The FDA does not have sufficient evidence demonstrating that these products are safe and effective for these purposes.
The FDA warning letters were sent to the following firms:
Tec Laboratories for Staphaseptic First Aid Antiseptic/Pain Relieving Gel;
JD Nelson and Associates for Safe4Hours Hand Sanitizing Lotion and Safe4Hours First Aid Antiseptic Skin Protectant;
Dr. G.H. Tichenor Antiseptic Co. for Dr. Tichenor’s Antiseptic Gel;
Oh So Clean, Inc dba CleanWell Company for CleanWell All-Natural Foaming Hand Sanitizer, CleanWell All-Natural Hand Sanitizer, CleanWell All-Natural Hand Sanitizing Wipes, and CleanWell All-Natural Antibacterial Foaming Handsoap
The warning letters explain that the companies are marketing these products in violation of federal law.
The companies have 15 days to correct the violations cited in the warning letters. Failure to do so may result in legal action including seizure and injunction. "
Thursday, April 7, 2011
AN EXAMPLE OF THE KICKBACK CRIME
The following is an excerpt fromt the the Anti Trust Division blog site:
" WASHINGTON — A Virginia contractor pleaded guilty to participating in a scheme to steer contracts to him for repair, maintenance and renovation work at healthcare and nursing home facilities owned by Medical Facilities of America Inc. (MFA), the Department of Justice announced today.
Edward T. Fodrey, a resident of Norfolk, Va., pleaded guilty in U.S. District Court in Norfolk to conspiring with other individuals to steer contracts for repair, maintenance and renovation at MFA healthcare and nursing home facilities. According to the two-count felony charge filed on March 30, 2011, from about May 2006 until at least December 2006, Fodrey conspired with an MFA employee who oversaw the bidding process for repair, maintenance and renovation contracts at MFA facilities in North Carolina and Virginia. That MFA employee steered contracts to Fodrey in return for kickbacks.
According to the court document, the MFA employee created fictitious competitor bids that were higher than the quotes submitted by Fodrey and other co-conspirator venders, to create the appearance of competition. The MFA employee directed subordinates to solicit quotes only from Fodrey or other conspiring vendors. The MFA employee specified the amount Fodrey should quote to MFA as well as the amount of the kickback on each of the contracts. Fodrey paid more than $200,000 in kickbacks to the MFA employee and received contracts totaling more than $750,000. The court document states that as a result of the kickback scheme, MFA was deprived of competitive pricing to its financial detriment. Fodrey was also charged with failing to file a tax return for 2006, which is the year in which Fodrey received payment on the MFA contracts. According to the plea agreement, Fodrey has agreed to cooperate with the department’s ongoing investigation.
Fodrey is charged with conspiracy to commit mail fraud for the kickback scheme, which carries a maximum penalty of 20 years in prison and a $250,000 criminal fine. Fodrey is also charged with failure to file an income tax return, which carries a maximum penalty of one year in prison and a $100,000 criminal fine. The maximum fines for each of these charges 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 maximums.
The charge is the first to arise out of the department’s ongoing fraud investigation into the award of repair, maintenance and renovation contracts at facilities owned by MFA being conducted by the Antitrust Division’s Philadelphia Field Office, the U.S. Attorney’s Offices for the Eastern District of Virginia and the Western District of Virginia, the FBI in Roanoke, Va., and the Internal Revenue Service-Criminal Investigation in Roanoke, Va. Anyone with information concerning fraudulent behavior relating to the award of contracts by MFA should contact the Antitrust Division’s Philadelphia Field Office at 215-597-7405 or visit www.justice.gov/atr/contact/newcase.htm. "
" WASHINGTON — A Virginia contractor pleaded guilty to participating in a scheme to steer contracts to him for repair, maintenance and renovation work at healthcare and nursing home facilities owned by Medical Facilities of America Inc. (MFA), the Department of Justice announced today.
Edward T. Fodrey, a resident of Norfolk, Va., pleaded guilty in U.S. District Court in Norfolk to conspiring with other individuals to steer contracts for repair, maintenance and renovation at MFA healthcare and nursing home facilities. According to the two-count felony charge filed on March 30, 2011, from about May 2006 until at least December 2006, Fodrey conspired with an MFA employee who oversaw the bidding process for repair, maintenance and renovation contracts at MFA facilities in North Carolina and Virginia. That MFA employee steered contracts to Fodrey in return for kickbacks.
According to the court document, the MFA employee created fictitious competitor bids that were higher than the quotes submitted by Fodrey and other co-conspirator venders, to create the appearance of competition. The MFA employee directed subordinates to solicit quotes only from Fodrey or other conspiring vendors. The MFA employee specified the amount Fodrey should quote to MFA as well as the amount of the kickback on each of the contracts. Fodrey paid more than $200,000 in kickbacks to the MFA employee and received contracts totaling more than $750,000. The court document states that as a result of the kickback scheme, MFA was deprived of competitive pricing to its financial detriment. Fodrey was also charged with failing to file a tax return for 2006, which is the year in which Fodrey received payment on the MFA contracts. According to the plea agreement, Fodrey has agreed to cooperate with the department’s ongoing investigation.
Fodrey is charged with conspiracy to commit mail fraud for the kickback scheme, which carries a maximum penalty of 20 years in prison and a $250,000 criminal fine. Fodrey is also charged with failure to file an income tax return, which carries a maximum penalty of one year in prison and a $100,000 criminal fine. The maximum fines for each of these charges 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 maximums.
The charge is the first to arise out of the department’s ongoing fraud investigation into the award of repair, maintenance and renovation contracts at facilities owned by MFA being conducted by the Antitrust Division’s Philadelphia Field Office, the U.S. Attorney’s Offices for the Eastern District of Virginia and the Western District of Virginia, the FBI in Roanoke, Va., and the Internal Revenue Service-Criminal Investigation in Roanoke, Va. Anyone with information concerning fraudulent behavior relating to the award of contracts by MFA should contact the Antitrust Division’s Philadelphia Field Office at 215-597-7405 or visit www.justice.gov/atr/contact/newcase.htm. "
Friday, March 25, 2011
SAMSUNG SDI COMPANY LTD PLEADS GUILTY TO GLOBAL PRICE FIXIING
The following case was obtained from the Department of Justices web site. It involves a global conspiracy to keep the prices high for color display tubes which also keeps prices high for people purchasing computer monitors. Price fixing is the antithesis of free enterprise and that is why governments prosecute for such activities.
“WASHINGTON — Samsung SDI Company Ltd. has agreed to plead guilty and to pay a $32 million criminal fine for its role in a global conspiracy to fix prices, reduce output and allocate market shares of color display tubes (CDTs), a type of cathode ray tube used in computer monitors and other specialized applications, the Department of Justice announced today.
According to a one-count felony charge filed today in U.S. District Court in San Francisco, Republic of Korea-based Samsung SDI participated in a conspiracy from at least as early as January 1997, until at least as late as March 2006, to suppress and eliminate competition by fixing prices, reducing output and allocating market shares of CDTs to be sold in the United States and elsewhere. According to the plea agreement, which is subject to court approval, Samsung SDI has agreed to cooperate with the department's ongoing cathode ray tube investigation.
According to the charge, Samsung SDI and co-conspirators agreed to charge prices of CDTs at certain target levels or ranges, to reduce output of CDTs by shutting down CDT production lines for certain periods of time and to allocate market shares of CDTs. As part of the conspiracy, Samsung SDI and co-conspirators exchanged CDT sales, production, market share and pricing information for the purpose of monitoring and enforcing adherence to their agreements. The department charged that the conspirators met in Taiwan, Korea, Malaysia, China and elsewhere for their discussions.
Samsung SDI is charged with violating the Sherman Act, which carries a maximum fine of $100 million for corporations. 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.
In addition to today's charge, six individuals have been indicted in connection with the CDT investigation. On Feb. 10, 2009, Cheng Yuan "C.Y." Lin was indicted for his participation in both the CDT conspiracy and a price-fixing conspiracy in the color picture tube industry. On Aug. 18, 2009, Wen Jun "Tony" Cheng was indicted for his participation in the CDT conspiracy. On March 30, 2010, Chung Cheng "Alex" Yeh was indicted for his participation in the CDT conspiracy. On Nov. 9, 2010, Seung-Kyu "Simon" Lee, Yeong-Ug "Albert" Yang and Jae-Sik "J.S." Kim were also indicted for their participation in the CDT conspiracy.
This case is part of an ongoing joint investigation by the Department of Justice Antitrust Division's San Francisco Office and the FBI in San Francisco. Anyone with information concerning illegal or anticompetitive conduct in the cathode ray tube industry is urged to call the Antitrust Division's San Francisco Field Office at 415-436-6660 or visit www.justice.gov/atr/contact/newcase.htm.”
One reason you must have a functioning government immune from bribes is so that real competitive capitalism can exist otherwise, all you have is cronyism and a corporate welfare state which works to stifle innovation and entrepreneurship.
“WASHINGTON — Samsung SDI Company Ltd. has agreed to plead guilty and to pay a $32 million criminal fine for its role in a global conspiracy to fix prices, reduce output and allocate market shares of color display tubes (CDTs), a type of cathode ray tube used in computer monitors and other specialized applications, the Department of Justice announced today.
According to a one-count felony charge filed today in U.S. District Court in San Francisco, Republic of Korea-based Samsung SDI participated in a conspiracy from at least as early as January 1997, until at least as late as March 2006, to suppress and eliminate competition by fixing prices, reducing output and allocating market shares of CDTs to be sold in the United States and elsewhere. According to the plea agreement, which is subject to court approval, Samsung SDI has agreed to cooperate with the department's ongoing cathode ray tube investigation.
According to the charge, Samsung SDI and co-conspirators agreed to charge prices of CDTs at certain target levels or ranges, to reduce output of CDTs by shutting down CDT production lines for certain periods of time and to allocate market shares of CDTs. As part of the conspiracy, Samsung SDI and co-conspirators exchanged CDT sales, production, market share and pricing information for the purpose of monitoring and enforcing adherence to their agreements. The department charged that the conspirators met in Taiwan, Korea, Malaysia, China and elsewhere for their discussions.
Samsung SDI is charged with violating the Sherman Act, which carries a maximum fine of $100 million for corporations. 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.
In addition to today's charge, six individuals have been indicted in connection with the CDT investigation. On Feb. 10, 2009, Cheng Yuan "C.Y." Lin was indicted for his participation in both the CDT conspiracy and a price-fixing conspiracy in the color picture tube industry. On Aug. 18, 2009, Wen Jun "Tony" Cheng was indicted for his participation in the CDT conspiracy. On March 30, 2010, Chung Cheng "Alex" Yeh was indicted for his participation in the CDT conspiracy. On Nov. 9, 2010, Seung-Kyu "Simon" Lee, Yeong-Ug "Albert" Yang and Jae-Sik "J.S." Kim were also indicted for their participation in the CDT conspiracy.
This case is part of an ongoing joint investigation by the Department of Justice Antitrust Division's San Francisco Office and the FBI in San Francisco. Anyone with information concerning illegal or anticompetitive conduct in the cathode ray tube industry is urged to call the Antitrust Division's San Francisco Field Office at 415-436-6660 or visit www.justice.gov/atr/contact/newcase.htm.”
One reason you must have a functioning government immune from bribes is so that real competitive capitalism can exist otherwise, all you have is cronyism and a corporate welfare state which works to stifle innovation and entrepreneurship.
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