Owner of Trash Company Charged with Fraud

This is an important case for demonstrating how a change in enforcement policy can result in significantly more “bang for the government enforcement buck.”  Here we have a US Attorney’s Office, FBI and Massachusetts Inspector General case out of Massachusetts.

Imagine an attorney in the Antitrust Division, in this case, an attorney in the New York Field Office, who, perusing press releases for case development leads, comes across this press release.  She looks at the alleged scheme and the investigative agencies and sees no obvious indication that this case, conduct and scheme have been reviewed by anyone as a possible approach point into a broader bid rigging scheme.  She would look at the press release for any “tells” about whether the defendant is being indicted or charged by information which can be an indicator of a plea agreement or maybe even a cooperation plea agreement.

Next she would seek to develop as much information that she could about the scope of the charged defendant’s business. What is the defendant’s total sales?  How is business won and awarded? Are they engaged in competitive bidding? How do the two companies function together when they are bidding? What companies are they bidding against? What companies are they not bidding against?    What contracts do they win and lose?  Are there areas where they do not pursue business where one might think they should?  Who are the competitors of these companies and how do they compete?  She would key on the significance difference in tipping fees based on customer type and and wonder how that impacts the competitive market.

After developing a rough sketch, she might reach out to the US Attorney’s Office or to the agents on the case.  What is the defendant facing in terms of a sentence?  Has he been interviewed?  Are there subordinates who are cooperating?  Any sign of a customer allocation conspiracy? Has anyone reviewed the company’s bidding?   Does the defendant have a cooperation agreement and is the defendant seeking to perfect a 5K-1 cooperation plea agreement prior to sentencing.  Assuming not, is there any receptivity to offering a Rule 35 downward departure motion after sentencing in the event the charged defendant was willing to provide evidence of other crimes?  Perhaps the Antitrust attorney would seek to speak with the defendant’s counsel to arrange a proffer under favorable circumstances to the defendant or, if the assessment by the prosecuting attorneys and agent are that such an approach would be fruitless, perhaps there are subordinates or former employees who are cooperating that might be willing to provide evidence about a separate bid rigging conspiracy or customer allocation agreement?

It is through efforts like these across the Department of Justice stable of cases where value added investigations can spawn often drawing in other individuals and companies who are alleged to have been engaged in a much broader conspiracy.   But lets also imagine that the Antitrust attorney who–proper closing that draws the reader to a conclusion that anyone who has bid against this company or companies like these to call me.

Department of Justice

U.S. Attorney’s Office
District of Massachusetts

Friday, March 31, 2017

BOSTON – The owner of a trash company was charged today in federal court in Boston in connection with defrauding the operator of the Fall River Landfill out of approximately $473,000 in disposal fees.

Stephen P. Aguiar, Jr., 47, of Westport, was charged with three counts of mail fraud. Aguiar was one of the owners and operators of Cleanway Disposal & Recycling, Inc., a trash removal and recycling company, and JS Aguiar Enterprises, Inc., a construction and equipment rental company, which were both located in Westport.

It is alleged that Aguiar contracted with the company operating the Fall River Landfill to dispose of trash collected from his private clients in Fall River for one rate, and to dispose of trash collected from his private clients outside of Fall River for a higher rate. Aguiar also contracted with the City of Fall River to collect trash from the Fall River Housing Authority (FRHA) and dispose of the trash at the landfill. The company operating the landfill allowed the City of Fall River to dispose of trash collected from FRHA properties at no charge. Between 2009 and 2014, Aguiar allegedly misrepresented the origin of a significant portion of the trash he disposed at the landfill. Aguiar claimed he was disposing trash from the FRHA, when in fact he was disposing trash collected from his private clients, thereby defrauding Fall River Landfill of approximately $473,000 in revenue.

The maximum sentence under the statute is 20 years in prison, three years of supervised release, a fine of $250,000, restitution and forfeiture. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.

Acting United States Attorney William D. Weinreb; Harold H. Shaw, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; Massachusetts Inspector General Glenn A. Cunha; and Christina Scaringi, Special Agent in Charge of the U.S. Department of Housing and Urban Development, Office of the Inspector General, Northeast Regional Office, made the announcement today. Assistant U.S. Attorney Kristina E. Barclay of Weinreb’s Public Corruption Unit is prosecuting the case.

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