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    Monday, June 17, 2024

    Conn. insulation companies ordered to repay Stratford $51,000 in bid-rigging scheme

    Stratford — A pair of Connecticut-based insulation companies have been ordered to repay the town more than $51,000 after officials from the two businesses were convicted of driving up the cost of construction work at Stratford High School as part of a years-long bid-rigging scheme.

    Officials from Langan Insulation and BC Flynn Contracting Corp. have been ordered by a federal judge to pay back $15,250 and $36,124, respectively, according to court records and prosecutors.

    Authorities have said the two companies conspired with other contractors in the region to divide up nearly $39 million in industrial insulation contracts between 2011 and 2018 by secretly sharing prices and bids.

    In addition to Stratford, the clandestine scheme targeted public institutions and private businesses across the state, including PepsiCo, Stamford Hospital and Yale University. Prosecutors have said the companies inflated their costs by at least $1.47 million.

    Company officials and attorneys for the companies did not immediately respond to requests for comment.

    "Bid rigging and fraud are serious crimes with serious consequences," Assistant Attorney General Jonathan Kanter said in a statement following the sentencing last week of BC Flynn co-owner Michael Flynn. "This sentence reflects the division's commitment to seeking appropriate punishment for criminal antitrust violations and ensuring that victims of antitrust crimes are made whole."

    On top of the restitution and a heavy fine, Michael Flynn was sentenced to 15 months in prison for his role in the scheme. Gary DeVoe, a senior branch manager for the same company, was also ordered last week to serve five months behind bars.

    Court documents show BC Flynn, which is based in Oxford, defrauded more than a half dozen institutions of about $1 million. Prosecutors have said the company overcharged Stratford by $36,124 for a $722,000 contract to upgrade Stratford High School's air conditioning system.

    Langan Insulation and its co-owner Thomas Langan were convicted of defrauding customers of more than $480,000, including charging Stratford an extra $15,250 for $305,000 in insulation work at the high school. Thomas Langan was ultimately sentenced to one year and one day in prison.

    Sarah Matthews, the chief of staff for Mayor Laura Hoydick, said Thursday that the town has not yet received any restitution payments but is monitoring the situation.

    "We're pleased to know that they've been ordered to repay all their victims," Matthews said.

    The town awarded the insulation contracts in 2017 as part of a larger $126 million project aimed at renovating and expanding the nearly 100-year-old school on King Street.

    Prosecutors have said the contractors conspired to eliminate competition by sharing proposals, estimates and other bid information with each other during meetings and by using a "disappearing messaging application." The companies also agreed to submit inflated bids to create the appearance of competition.

    In a victim impact statement, Stratford officials described the construction work by Langan Insulation and BC Flynn as "more than adequate." But they also urged the court to hand down a punishment that would deter future corruption.

    "The defendants here knew the rules when they decided to bid on the project, but apparently were not satisfied with the monies they would have earned had they had to make a truly independent bid," town officials wrote. "As a result, rather than simply declining to bid on the project, they took affirmative steps to guarantee that their ultimate financial goal would be realized, again to the economic detriment of the citizens and taxpayers of Stratford."

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