On Friday November 19, 2010, the Department of Justice (“DOJ”) announced that James M. Woodason, a former department manager at Consolidated Edison of New York (“Con Edison”), pleaded guilty to charges of accepting and agreeing to accept $807,000 in bribes from industrial pipe supply vendors. Woodason pleaded guilty in a U.S. District Court in Manhattan.
The Antitrust Division of the DOJ is conducting an ongoing investigation into bid rigging, bribery, fraud and tax-related offenses throughout the power generation industry. The Federal Bureau of Investigations (“FBI”) and the Internal Revenue Service (“IRS”) Criminal Division are assisting the DOJ. Woodason was arrested on August 5, 2010 in connection with the investigation by FBI and IRS Criminal Investigation Special Agents.
Woodason faced charges of two counts of conspiracy, income tax evasion and bribery. He allegedly accepted $297,000 from one vendor in a bribery scheme from November 2003 to August 2008 and accepted $45,000 from another vendor in a bribery scheme from January 2009 to August 2010. Woodason also agreed to take another $465,000 in bribes from that same vendor in 2009-2010 in exchange for “steering contracts” to the vendor. At Con Edison, Woodason purchased and awarded contracts for goods and services and managed inventory.
Under the terms of his plea agreement, Woodason pleaded guilty to one count of bribery for a $20,000 cash bribe from the 2009-2010 conspiracy and one count of income tax evasion for failing to report bribes as income received from 2004 to 2008. Woodason also agreed to place $322,000 in escrow to pay restitution to Con Edison. Woodason could face up to ten years in prison and a $250,000 for each count of bribery, and five years in prison and a $250,000 fine for income tax evasion. Additionally, the fine for each count can be increased to “twice the gain derived from the crime or twice the loss suffered by the victims of the crime” if that amount is higher than the statutory maximum.
Con Edison cooperated with the DOJ investigation and also made a public filing with the Securities and Exchange Commission regarding its case. Con Edison had a separate bribery scheme in 2009 which led to the arrest of ten Con Ed supervisors and one retired Con Ed employee who allegedly took $1 million in “kickbacks” from contractors in connection with construction projects in New York City and Westchester County beginning in 2004.
A link to the DOJ’s press release is available here.