FOR IMMEDIATE RELEASE AT
TUESDAY, OCTOBER 29, 1996 (202) 616-2771
TDD (202) 514-1888
FORMER NEW YORK DISPLAY MATERIALS SUPPLIER TO PHILIP
MORRIS INDICTED IN BID RIGGING AND TAX FRAUD
CONSPIRACIES
WASHINGTON, D.C. -- A New York City federal grand jury
today indicted a New York executive and two of his companies for
bid-rigging and tax fraud in connection with the supply of
advertising display materials sold to Philip Morris Inc.
To date, 11 individuals and four corporations have
pleaded guilty to various federal charges as a result of the
Department of Justice's ongoing antitrust investigation of bid
rigging, commercial bribery and tax-related offenses in the
display industry.
The seven-count indictment, filed today in the federal
courthouse in the Southern District of New York (New York City),
charges Dani Siegel of New York City and Westhampton, New York,
and two of his companies with violating antitrust and tax laws.
The indictment replaces an earlier four-count indictment filed in
June against the same defendants.
Siegel and his Englewood, New Jersey-based Visart
Mounting & Finishing Corp., are charged with participating in a
bid rigging conspiracy involving contracts awarded by Philip
Morris Inc. in New York City for the supply of point-of-purchase
display materials used to advertise and promote products in
retail stores. During the conspiracy, Visart obtained display
contracts with Philip Morris worth about $5 million. The
conspiracy took place from November 1987 to October 1991.
The indictment also charges that Siegel, Visart and one
of his other companies, Manhattan-based Genetra Affiliates Inc.,
participated in a tax fraud conspiracy. The conspiracy took
place from June 1987 to March 1994.
The remaining five counts charge Siegel with tax
related offenses.
Joel I. Klein, Acting Assistant Attorney General in
charge of the Justice Department's Antitrust Division, said,
"The Antitrust Division is committed to investigating and
prosecuting anticompetitive conduct in the display industry.
This indictment and our continuing investigation is further proof
of that resolve."
Siegel, Visart and Genetra are also charged with tax
fraud in connection with a conspiracy to raise and accumulate
about $1.6 million in cash. The conspiracy involved more than
150 sham transactions that were designed to overstate Genetra's
and Visart's expenses, take false deductions and conceal cash
income that was not reported to authorities. In addition, the
conspiracy allowed Genetra to avoid reporting more than $500,000
in gross sales. Siegel is also charged with subscribing to false
federal tax returns filed by Genetra from 1989 through 1993.
This prosecution is the result of an investigation
being conducted by the Antitrust Division's New York Field Office
with the assistance of the Federal Bureau of Investigation and
the Internal Revenue Service.
Among the 11 individuals that have been charged thus
far are executives of the Englewood, New Jersey-based AM-PM Sales
Co. Inc., identified in today's charge as co-conspirators with
Siegel and Visart in the bid-rigging conspiracy, and Bert Levine,
a Morris Plains, New Jersey resident, identified as a co-conspirator in the tax fraud conspiracy.
The maximum penalty for an individual convicted of a
violation of the Sherman Act committed after November 16, 1990,
is three years in prison and a fine not to exceed the greatest of
$350,000, twice the pecuniary gain the individual derived from
the crime or twice the pecuniary loss caused to the victims of
the crime.
The maximum penalty for a corporation convicted of a
violation of the Sherman Act continuing after November 16, 1990
is a fine not to exceed the greatest of $10 million, twice the
pecuniary gain derived from the crime or twice the pecuniary loss
caused to the victims of the crime.
The maximum penalty for an individual convicted of
conspiracy to defraud the Internal Revenue Service or income tax
evasion is five years in prison and a fine not to exceed the
greatest of $250,000, twice the pecuniary gain the individual
derived from the crime or twice the pecuniary loss to the
victims. The maximum sentence for an individual convicted of
subscribing to fraudulent tax returns is three years in prison.
Anyone with information concerning bid rigging, bribery
or fraud in the display industry may contact the New York
Division of the FBI at (212) 384-1000.
###
96-528