Auction Bidder Pleads Guilty to Participating in Bid-Rigging of Online GSA Auctions

On September 24, the U.S. Department of Justice announced that Igor Yurkovetsky pleaded guilty in the District of Minnesota to a criminal violation of the Sherman Act.  The information charged Yurkovetsky with participating in a conspiracy, from about July 2012 until as late as May 2018, to rig bids at online public auctions of surplus government equipment that the U.S. General Services Administration (GSA) held.

According to the Department, the GSA operates GSA Auctions, which conducts online auctions allowing the general public “the opportunity to bid electronically on a wide variety of federal assets, including computer equipment that is no longer needed by government agencies.”  Proceeds of GSA auction sales are distributed to the government agencies that made the equipment available for auction, or to the U.S. Treasury general fund.

The Department stated that “the primary purpose of the conspiracy was to suppress and eliminate competition,” and that “the co-conspirators obtained the equipment by agreeing which co-conspirators would submit bids for particular lots offered for sale by GSA Auctions and which co-conspirator would be designated to win a particular lot.”

Yurkovetsky, who reportedly agreed to cooperate in the ongoing investigation of this conspiracy, is the second person charged in that investigation. The Assistant Attorney General for the Justice Department’s Antitrust Division, Makan Delrahim, promised, “This charge will not be the last in this investigation.”

N.B.:  Although more facts about the alleged bid-rigging conspiracy are likely to emerge as the Antitrust Division continues its investigation, antitrust-compliance and legal officers in companies that conduct auctions as part of their operations should bring this plea to the attention of senior executives.  Business executives need to recognize that bid-rigging is a core criminal violation that the Antitrust Division has long made an enforcement priority, and that the Sherman Act’s prohibitions apply whether the auctions in question are brick-and-mortar or virtual and government or private.

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