Manager for Insulation Contractor Pleads Guilty in Bid-Rigging Scheme

April 9, 2019

A branch manager for an insulation contractor pleaded guilty Monday for his role in schemes to rig bids and engage in fraud on insulation installation contracts, the U.S. Attorney’s Office for Connecticut announced.

Gary DeVoe of Bethlehem, Connecticut entered a guilty at the U.S. District Court in Bridgeport. Prosecutors say DeVoe conspired with insulation installation contractors to rig bids and engage in fraud on contracts in Connecticut, New York, and Massachusetts. Insulation installation contractors install insulation around pipes and ducts on renovation and new construction projects at universities, hospitals, and other public and private entities. In addition to his guilty plea, DeVoe has agreed to pay restitution, the U.S. Attorney’s Office said.

“Today’s conviction is the result of a coordinated effort between the Department of Justice and our law enforcement partners to root out collusion and fraud that undermined the competitive process and defrauded hospitals, schools, and other victims out of millions of dollars,” said Assistant Attorney General Makan Delrahim of the Department of Justice’s Antitrust Division. “Contractors who conspire to deceive and defraud their customers will be prosecuted.”

The U.S. Attorney’s Office press release did not identify DeVoe’s employer. But the Connecticut Post reported that DeVoe was listed as a senior branch manager for the New England Region on the website of BC Flynn, a contractor with offices in New York and Oxford, Conn.

“This defendant participated in a long-running conspiracy among insulation contractors in Connecticut, Massachusetts and New York,” said U.S. Attorney John H. Durham. “They cooked up collusive bids, shared bid numbers with their competitors and communicated with co-conspirators via encrypted messaging apps, all in an effort to line their own pockets and their companies’ bottom lines. The real victims are the hospitals, universities and businesses that were duped into paying corruptly inflated bids on $45 million worth of insulation jobs throughout New England.”

The antitrust charge carries a maximum penalty of 10 years in prison and a fine of $1 million for individuals. The fraud conspiracy charge carries a maximum penalty of 20 years in prison and a fine of $250,000. The fines for the antitrust and fraud conspiracy 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 maximum fine. DeVoe will also be ordered to pay restitution to the victims.

DeVoe also agreed to resolve civil forfeiture cases connected to the criminal charges. DeVoe agreed to settle the pending forfeiture action on his home for $131,000 and to forfeit all of his seized bank accounts.

The ongoing investigation is being conducted by the Antitrust Division’s New York Office, the United States Attorney’s Office for the District of Connecticut, the FBI’s New Haven Division, and the Defense Criminal Investigative Service.

Source: U.S. Attorney for the District of Connecticut

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