/>iOn March 3, 2020, the American Bar Association (ABA) hosted a Q&A with two members of the Procurement Collusion Strike Force (PCSF)—Mark Grundvig, the Assistant Chief of the DOJ Antitrust Division’s Criminal II section, and Markus Mills, Special Agent, Major Fraud Investigations Division, USPS Office of Inspector General.
During the course of the Q&A, Mr. Grundvig and Mr. Mills provided their perspective on the goals and progress of the PCSF.
WHAT HAPPENED:
-
The PCSF representatives explained that the PCSF is heavily focused on improving detection of per se antitrust violations such as bid-rigging, price-fixing and market-allocation.
-
To improve detection, the PCSF is:
-
Training agents on per se antitrust violations and other anticompetitive conduct to improve agents’ ability to spot antitrust violations;
-
Training industry participants via tradeshows and industry conferences on per se antitrust violations and other anticompetitive conduct to increase industry reporting via tips or applications to the leniency program;
-
Obtaining and reviewing data from historical (and future) bids; and
-
Developing cross-agency database of allegations/concerns.
-
-
The PCSF believes these actions will not only increase detection, but will also deter conduct—a positive feedback loop to reduce antitrust violations. The more stakeholders that understand what are antitrust violations, the greater the threat of detection for those bad actors.
-
As reported here and noted in the press release announcing the strike force on November 5, 2019, the PCSF is focusing its efforts on 13 US Attorney Office (USAO) districts. However, more than 40 local, state and federal jurisdictions have since reached out to participate with the PCSF.
-
The PCSF will investigate any product market, and the PCSF is not focused on specific markets. The PCSF members noted, however, that investigations into one industry often yield parallel investigations into related or adjacent industries, particularly if the companies involved are active in multiple industries.
-
Publicity from the formation of the PCSF has already been credited with yielding several investigations via complaints—confirming that detection will only improve with the PCSF in place.
WHAT THIS MEANS:
-
The PCSF is focused on increasing its ability to detect antitrust violations across a broader cohort of government contractors because of the rapid increase in government procurement over the last five years. The investigators believe that this increase in spending has led to increased abuses. Because taxpayer money is at stake, the PCSF will be aggressive in investigating any abuses it detects or are brought to its attention.
-
We believe that particular interest should be paid to these developments by small- and medium-sized government contractors. While the PCSF will investigate any size fraud or antitrust violation, the task force members noted that larger government contractors tend to have robust training and mitigation programs to prevent the kinds of conduct that the PCSF is focused on eliminating.
-
The increased political focus on violations of the antitrust laws in all respects, along with the DOJ’s recent decision to consider effective antitrust compliance programs when charging, makes a strong business case for those in the government procurement space to review and revise current compliance programs or implement a compliance program if one is not already in place.
-
Auditing or implementing a compliance program is a prudent low-cost action item that gives stakeholders increased security that they are taking the proper steps to mitigate exposure.
