Articles Posted in White Collar Crime Highlights

On August 25, 2009, Epson Imaging Devices Corporation (“Epson”), a Japanese electronics manufacturer, pled guilty for its role in a conspiracy to fix prices in the sale of Thin Film Transistor-Liquid Crystal Display (“TFT-LDC”) panels and agreed to pay a fine of $26 million.

TFT-LCD panels are used in computer monitors, notebooks, televisions, mobile phones, and other electronic devices. Worldwide sales in 2006 were $70 billion.

Specifically, Epson’s subsidiary Seiko Epson Corporation participated in a conspiracy to fix prices of TFT-LCD panels sold to Motorola for use in Motorola Razr mobile phones from the fall of 2005 to the middle of 2006.

On August 19, 2009, Wen Jun (“Tony”) Cheng, a former assistant vice president of sales and marketing at a large Taiwanese color display tube (CDT) manufacturing company, was indicted at U.S. District Court in San Francisco for his role in a global conspiracy to fix prices of CDTs. CDTs are a type of cathode ray tube used in computer monitors and other specialized applications

According to the indictment, Mr. Cheng participated in the conspiracy along with unnamed co-conspirators to suppress and eliminate competition by fixing prices, reducing output, and allocating market shares of CDTs. The indicitment also alleges that Mr. Cheng and his co conspirators engaged in communication and conversations at meetings in Taiwan, Korea, Malaysia, China, and other places to agree on prices, output, and market shares of CDTs. He and his co-conspirators were allegedly able to set up an audit system to verify production outputs. This conspiracy lasted from January 1999 and September 2004.

Cheng was previously indicted on Feb. 3, 2009, for his participation in a global conspiracy to fix prices of Thin Film Transistor-Liquid Crystal Display (TFT-LCD) panels.

On July 28, 2009, Nyree Patterson, the niece of former U.S. Army Major John Cockerham, pled guilty for her role in conspiracy to cover up her uncle’s involvement in accepting $9 million in bribes as a contracting officer at a Kuwaiti air base.

Ms. Pettaway admitted to going to Kuwait in late 2006 and receiving $3 million in cash to return to co-conspirators for safekeeping. On March 19, 2009, Carolyn Blake, sister of U.S. Army officer John Cockerham, pled guilty for her participation in a money-laundering scheme and accepting $3 million in bribes on behalf of her brother. On June 24, 2008, John Cockerham, a U.S. Army office, and his wife, Melissa Cockerham, of San Antonio pled guilty to charges of conspiracies to commit bribery and money laundering. Mr. Cockerham admitted to his role in a complex bribery and money laundering scheme as an Army major in Kuwait. He awarded illegal contracts for services to be delivered to troops in Iraq in exchange for $9 million in bribes. Mr. Cockerham directed contractors to pay his wife, sister, and others to hide the fact that he was receiving bribes. Mrs. Cockerham admitted to accepting $1 million in bribes and storing them in various banks in Kuwait and Dubai on behalf of her husband.

Andre Barlow

On July 17, 2009, Patriot Services Inc. (“Patriot”), a temporary staffing company used by various government agencies and departments, and its owner/president, Stephanie Blackmon, pled guilty to making a false statement to the U.S. Small Business Association (“SBA”).

Although Ms. Blackmon was officially the owner/president of Patriot from November 2003, the operations of Patriot was actually run by Ms. Blackmon’s former employer who also ran other temporary staffing companies. Specifically, Ms. Blackmon admitted to providing false statements so that Patriot could receive a certification under Section 8(a) of the Small Business Act. This certification, designated for small businesses run by economically and socially disadvantaged people, qualified Patriot to receive government contracts specifically set aside for 8(a) companies. Since Ms. Blackmon is an African-American, Patriot qualified for the certification. In addition, Patriot also used Ms. Blackmon’s status as a service-disabled veteran to receive other contracts as well. The government had awarded Patriot $5.4 million in contracts.

Andre Barlow

On July 6, 2009, Robert P. Griffiths, a former executive at Bennett Environmental Inc (“BEI”), a Canadian company that provides soil treatment, pled guilty to charges for paying kickbacks and committing fraud at the U.S. Environmental Protection Agency (“EPA”) Superfund-site Federal Creosote in New Jersey. Mr. Griffiths also pled guilty to money laundering charges and obstruction of an impeding proceeding by the U.S. Securities and Exchange Commission.

The cleanup of the Federal Creosote site, funded by the EPA and Army Corps of Engineers, was contracted out to private companies that oversaw the removal, treatment and disposal of contaminated soil, as well as other operations at the site. The prime contractor of the site sub-contracted these services to BEI and its co-conspirators.

Mr. Griffiths and his co-conspirators were given bid prices so BEI could bid the highest price and be awarded the sub-contract at the Federal Creosote site. On one occasion, Griffiths and his co-conspirators received $1.3 million in kickbacks from an inflated bid. Kickbacks usually took the form of wired transfers, lavish cruises, various entertainment tickets, pharmaceuticals and home entertainment electronics. In all, Mr. Griffiths and his co-conspirators were awarded $43 million in fraudulent sub-contracts. The conspiracy took place between December 2001 and August 2004.

On July 1, 2009, First Lieutenant Robert Moore (Ret.), plead guilty to conspiracy and bribery charges. Mr. Moore accepted money from contracts in exchange for Department of Defense (“DOD”) contracts at the Bagram Airfield, Afghanistan (“Bagram”). He also falsified the number of bunkers and barriers delivered to Bagram, causing the DOD to pay for bunkers and barriers it never received. Mr. Moore also falsified the damages to leased vehicles at Bagram causing the DOD to pay for repairs performed or not needed.

He agreed to pay $120,000 in restitution and cooperate in the Department of Justice’s ongoing investigation. As a part of this same investigation on June 19, 2009, Christopher P. West, a U.S. Army Major, and Patrick W. Boyd, a U.S. Air Force Master Sergeant pled guilty to various bribery, fraud, and conspiracy charges related to Department of Defense contracts at Bagram. Charles Patton, a U.S. Army Sergeant pled guilty for receiving stolen property connected to the bribery conspiracy. Assad John Ramin and Tahir Ramin, both U.S. citizens, and their companies AZ Corporation and Top’s Construction, Noor Alam, an Afghan citizen, and his company Northern Reconstruction Organization, and Abdul Qudoos Bakhshi, an Afghan citizen, and his company Naweed Bakhshi Company were all indicted for bribing military officials and defrauding the U.S. Department of Defense (“DOD”).

Andre Barlow

On June 30, 2009, Franch A. March, a chief executive officer of a former Virginia marine products company, pled guilty for his role in conspiracy to rig bids and allocate customers with respect to foam-filled fenders and buoys bought by the U.S. Navy, U.S. Coast Card, and other private companies. Mr. March has also agreed to pay a fine of $100,000 and serve jail time, the amount of time still to be determined by a court.

Foam-filled marine fenders are used as a cushion between ships and fixed structures, such as docks, piers or other ships. Foam-filled buoys are used in a variety of applications, such as channel markers and navigational aids.

Mr. March participated in the conspiracy from June 2002 and December 2002. He as agreed to cooperate with the Department of Justice’s ongoing investigation. Several other executives have already pled guilty for participating in this conspiracy.

On June 25, 2009, Tijani Ahmed Saani, a contracting officer at the Department of Defense, plead guilty to filing false tax returns from 2003 to 2007.

While working on detail at Camp Arifjan, Kuwait, he failed to properly file tax returns by not reporting overseas bank accounts in the United States and Jersey Channel Islands.

Andre Barlow

On June 25, 2009, Frederick Landgraber, a co-owner of a New Jersey landscaping company, plead guilty to his role in a fraud conspiracy at the Environmental Protection Agency (“EPA”)-Superfund site, Federal Creosote.

Mr. Landgraber was involved in the conspiracy from March 2002 to June 2005. Mr. Landgraber paid $30,000 to an employee prime contractor at Federal Creosote so that employee would steer contracts to Mr. Landgraber’s landscaping company. He and his co-conspirator intentionally bid increased cover bids from fictitious companies to secure the bids for their companies. His company received $1.5 million in sub-contracts at the Superfund-site.

On February 26, 2009, Christopher Tranchina, an employee of a company temporarily responsible for electrical utilities pled guilty to defrauding the EPA at that site. He is schedule for sentencing on July 13, 2009. On December 18, 2008, Zul Tejpar, a former employee at Bennett Environmental Industries pled guilty for defrauding the EPA at Federal Creosote site and agreed to pay a criminal fine of $1 million and help in the ongoing investigation. As a part of the same investigation, on July 31, 2008, Mr. Tejpar’s former employer, BEI, pled guilty and agreed to pay $1 million criminal fine for its role in a conspiracy to defraud the EPA at designated Superfund site, Federal Creosote in Manville, NJ. On June 23, 2008, JMJ Environmental Inc., a New Jersey wastewater treatment supply company, and its executives pled guilty to defraud the EPA at two New Jersey Superfund sites, including the Federal Creosote site.