TEXARKANA, Texas -- Criminal cases filed Friday in federal court in Texarkana accuse two men of conspiracy to restrain trade by rigging bids for lucrative government contracts at Red River Army Depot.
An indictment charging Aaron Stephens in the Texarkana Division of the Eastern District of Texas alleges that he and unnamed co-conspirators agreed with each other to bid on contracts, some in the millions, in such a way that it gave the false impression of competition when in fact the bidders were working together.
Count one of Stephens' indictment alleges conspiracy to restrain trade beginning at least in May 2013 and continuing through around April 2018. The indictment identifies several businesses associated with or partially owned at some point by Stephens as involved in the collusion, including HP Logit, White's Paint Blast, Texarkana Parts and Logistics and Stephens Service Group.
Count 1 identifies seven bids awarded to Stephens or a co-conspirator that allegedly were rigged.
Count 2 of the indictment alleges conspiracy to defraud the United States from at least May 2013 to around April 2018.
Stephens is accused in Count 3 of his indictment of conspiracy to defraud the government from June 2019 to June 2020.
Count 3 involves allegedly "fraudulent and rigged bids for a contract to provide construction work related to a natural gas distribution system," or gas pipeline, at the Pine Bluff Arsenal in Arkansas.
"The proposals submitted by Aaron Stephens and co-conspirator 2 were, in part, substantially similar, including certain portions of text that were identical," the indictment alleges.
While Stephens and co-conspirator 2 allegedly submitted bids on behalf of two different businesses, the goal was to insure that a company they co-owned, Stephens Services Group, "could perform subcontracting work" for a company co-conspirator 2 controlled, the indictment alleges.
An information charging John Mark Leveritt Jr. with conspiracy to restrain trade by rigging bids at RRAD was filed Friday. The case docket indicates that Leveritt has entered into a plea agreement with the government.
Leveritt is accused of rigging bids from May 2013 to April 2018, the same time frame outlined in count one of the indictment charging Stephens. According to Bizapedia, Stephens and Leveritt were both listed as officers with Texarkana Parts and Logistics until the company "voluntarily dissolved."
Court records in both Stephens' and Leveritt's cases indicate that attorneys with the Antitrust Division of the U.S. Department of Justice are working with the U.S. Attorney in the Eastern District of Texas in the cases.
A notice of punishment is not included with Stephens' indictment though a notice of penalty attached to the information charging Leveritt states that conspiracy to restrain trade is punishable by up to 10 years in federal prison. Also possible is a fine in an amount equal to the greatest of three options: $1 million, twice the gain the conspirators derived from the crime or twice the loss caused to the victims.
Neither Stephens nor Leveritt has appeared in court, and records do not reflect any scheduled hearings.
Other alleged RRAD contract fraud
Multiple former RRAD officials and vendors have pleaded guilty to charges including bribery involving government contracts in the last 12 months.
The alleged mastermind of a bribes-for-contracts scheme, Jimmy Scarbrough, is scheduled for a jury trial in September in Texarkana's downtown federal building. Scarbrough has pleaded not guilty to conspiracy to defraud the United States, two counts of bribery and a charge of conspiracy to launder money.
Scarbrough was equipment mechanic supervisor at RRAD from November 2001 until May 2019, according to a criminal complaint and an indictment. Scarbrough's position allegedly allowed him to take advantage of the Government Purchase Card, or GPC, process for years.
"Though Scarbrough did not formally have GPC authority, he found vendors, communicated directly with vendors and obtained quotes from vendors which the GPC purchasers then used," the complaint states. "Scarbrough was responsible for verifying the actual delivery of goods or services and signing the invoice."
Jeffery Harrison of Texarkana and Justin Bishop of Clarksville, Texas, pleaded guilty in May 2021 to theft of government property and bribery respectively. Harrison and Bishop represented vendors seeking government contracts at the depot.
Devin McEwin entered a plea of guilty to bribery in June 2021. McEwin was a public official whose duties at RRAD involved purchasing electrical supplies. He accepted bribes of more than $21,000 from Harrison.
Louis Edward Singleton pleaded guilty to bribery in April. Singleton was an RRAD official whose duties included supervising the government purchase card program at RRAD. He accepted bribes in the form of tickets and parking passes to professional football games from representatives of H&H Enterprises, according to a factual basis document filed in the case.
"From before 2010 and continuing through at least November 2019, I agreed with Jimmy Scarbrough, C.H., B.H., and Jeffery Harrison to defraud the United States," the document states.
An information charging Carl Hall with bribery was filed Thursday. He is scheduled for a plea hearing June 9 in Texarkana.
Hall is accused of "indirectly" giving Singleton tickets and a parking pass worth $4,599.98 to watch the Dallas Cowboys play the New England Patriots at AT&T Stadium in October 2015.
Scarbrough allegedly accepted more than $100,000 in money orders from Harrison and collectible firearms from Bishop. The government is seeking Scarbrough's forfeiture of several antique cars he allegedly bought with bribe money as well as a judgment for more than $300,000.
None of the defendants are in custody. Those who have appeared in court are free on unsecured appearance bonds.
All of the cases are pending in the Texarkana Division of the Eastern District of Texas and are assigned to U.S. District Judge Robert Schroeder III.