A federal investigation into an alleged $45 million bid-rigging scheme has resulted in two more guilty pleas.
On Monday, Langan Insulation LLC of North Haven and its co-owner, Thomas F. Langan of East Haven, pleaded guilty to antitrust and fraud conspiracy charges in U.S. District Court in Bridgeport.
According to the U.S. Attorney’s office, these latest pleas bring the total convictions to five, and the probe is still ongoing.
Prosecutors allege the scheme went on for years, from approximately 2011 through 2018. Those involved conspired to rig bids related to contracts for the installation of insulation around pipes and ducts on construction projects.
The work was performed at universities, hospitals and other public and private entities throughout the state and region. As a result of the scheme, victims ended up paying more than they should have for projects, according to the government.
The conspirators discussed prices and agreed on bids that inflated prices by about 10 percent, prosecutors said. To hide what they were doing, they allegedly employed technology such as an encrypted disappearing messaging app.
Three others pleaded guilty last year, including Michael Flynn of Ridgefield, co-owner of BC Flynn Contracting Corp. of Oxford; Gary DeVoe of Bethlehem, branch manager for BC Flynn’s New England Division; and Paul M. Camara Jr., of Brooklyn, Conn., partner at Axion Specialty Contracting in Massachusetts.
Connecticut’s U.S. Attorney John H. Durham said the scheme “defrauded hospitals, universities and businesses across New England of millions of dollars.”
“The guilty pleas demonstrate that the Department of Justice will seek to hold both individuals and companies accountable for rigging bids,” Durham said in an announcement.
BC Flynn, for example, has indicated that it has been involved in projects at Yale University, the University of Connecticut, UConn Health Center, and the Yale Cancer Center.
The antitrust charge carries a maximum penalty of 10 years in prison and a criminal fine of $1 million for individuals, and a criminal fine of $100 million for corporations. The fraud conspiracy charge carries up to 20 years in prison and a criminal fine of $250,000 for individuals, and a criminal fine of $500,000 for organizations.
However, a judge may impose a fine of twice the gain derived from the crime or twice the loss suffered by victims.
Both Langan Insulation LLC and Thomas F. Langan have agreed to pay restitution to any victims, according to the U.S. Attorney’s office.
On Tuesday, an employee at Langan Insulation reached via telephone deferred comment to Attorney Raymond Hassett of Glastonbury, who could not immediately be reached.
Anyone with information relevant to the investigation is asked to contact the Department of Justice’s Antitrust Division’s New York Office at 212-335-8000.
Contact Michelle Tuccitto Sullo at msullo@newhavenbiz.com.
