Alan Gaines, Online Auction Rigging, Missouri 2020

A Missouri man has been caught red-handed in a scheme to rig online bids on surplus government equipment auctions.

According to court documents, Alan Gaines pleaded guilty to the one-count indictment filed in the U.S. District Court in Minneapolis on January 30, 2020.

Gaines, a Missouri resident, conspired with others to rig bids at online public auctions of surplus government equipment conducted by the General Services Administration (GSA) from about July 2012 until as late as May 2018.

Gaines is the third individual charged and the third individual to plead guilty in the investigation.

“For years, the defendant’s self-serving scheme stole from the government and robbed American taxpayers,” said Acting Assistant Attorney General Richard A. Powers of the Antitrust Division. “I commend the team of GSA Office of Inspector General (OIG) agents and Antitrust Division prosecutors and paralegals for their dedication to safeguarding online auctions from collusion.”

The GSA operates GSA Auctions, which offers 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.

According to the indictment, the primary purpose of the conspiracy was to suppress and eliminate competition. Gaines and his 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.

Gaines pleaded guilty to a violation of the Sherman Act. He faces a maximum of 10 years in prison and a $1 million criminal fine for individuals. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.

A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

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