Former U.S. Executive of Italian Marine Hose Manufacturer Agrees to Plead Guilty...

Former U.S. Executive of Italian Marine Hose Manufacturer Agrees to Plead
Guilty to Participating in Worldwide Bid-Rigging Conspiracy

Former Executive Agrees to Serve Jail Time

WASHINGTON, April 17 /PRNewswire-USNewswire/ -- A former U.S. executive of
Manuli Rubber Industries SpA, a Milan, Italy-based marine hose manufacturer,
has agreed to plead guilty and serve jail time for participating in a
conspiracy to rig bids, fix prices and allocate market shares of marine hose
in the United States and elsewhere, the Department of Justice announced today.

A one-count felony charge was filed today in U.S. District Court in Houston
against Charles J. Gillespie. Gillespie is a former regional manager
responsible for the sale of marine hose of Manuli Rubber Industries SpA's U.S.
operations based in the Fort Lauderdale, Fla. area. Under the terms of his
plea agreement, which is subject to court approval, Gillespie has agreed to
serve 12 months and one day in jail, pay a $20,000 criminal fine and cooperate
fully in the Department's ongoing investigation.

"The Antitrust Division will continue to vigorously pursue and prosecute
international cartels," said Thomas O. Barnett, Assistant Attorney General in
charge of the Department's Antitrust Division. "Those who conspire to harm
U.S. consumers will be held accountable for their illegal actions."

Marine hose is a flexible rubber hose used to transfer oil between tankers and
storage facilities. During the conspiracy, the prices for hundreds of millions
of dollars worth of marine hose and related products were affected by the
cartel worldwide. The victims of this conspiracy include companies involved in
the off-shore extraction and/or transportation of petroleum products and the
U.S. Department of Defense (DOD).

Gillespie is charged with participating in the conspiracy from at least as
early as 2000 until as late as May 2007. The Department charged that during
the conspiracy Gillespie and his co-conspirators:
* Attended meetings or otherwise engaged in discussions in the United States
and elsewhere by telephone, facsimile and electronic mail regarding the sale
of marine hose, agreeing to allocate shares of the marine hose market among
the conspirators;

* Agreed during those meetings and discussions to a price list for marine hose
in order to implement and monitor the conspiracy;

* Agreed during those meetings and discussions not to compete for one
another's customers either by not submitting prices or bids to certain
customers or by submitting intentionally high prices or bids to certain
customers;

* Submitted bids in accordance with the agreements reached;

* Provided information received from customers in the United States and
elsewhere about upcoming marine hose jobs to a co-conspirator who was not an
employee of any of the marine hose manufacturers, but who served as the
coordinator of the conspiracy, acted as a clearinghouse for information to be
shared among the conspirators, and was paid by the manufacturers for
coordinating the conspiracy;

* Received marine hose prices for customers in the United States and elsewhere
from the co-conspirator coordinator of the conspiracy;

* Sold marine hose to customers in the United States and elsewhere at
collusive and noncompetitive prices under the agreements reached;

* Accepted payment for marine hose sold in the United States and elsewhere at
collusive and noncompetitive prices;

* Authorized or consented to the participation of subordinate employees in the
conspiracy; and

* Concealed the conspiracy and conspiratorial contacts through various means,
including code names and private email accounts and telephone numbers.

Eight foreign executives were arrested on May 2, 2007, in Houston and San
Francisco and charged for their role in the marine hose cartel, following
their participation in a cartel meeting in Houston. On Dec. 12, 2007, Bryan
Allison and David Brammar, executives with Dunlop Oil & Marine Ltd., a
manufacturer of marine hose located in Grimsby, U.K., pleaded guilty to
participating in the marine hose conspiracy. Under the terms of their plea
agreements, Allison agreed to serve 24 months in jail and Brammar agreed to
serve 20 months in jail. Peter Whittle, a former Dunlop employee now the sole
proprietor of PW Consulting (Oil & Marine) Ltd., pleaded guilty for his
leadership role in the conspiracy and agreed to serve 30 months in prison. The
three agreed-upon sentences represent the longest sentences ever agreed to by
foreign nationals for antitrust offenses. Under the terms of the plea
agreements, Allison, Brammar and Whittle were returned in custody to the U.K.
on Dec. 18, 2007, where they were arrested and criminally charged with cartel
offenses by the U.K. authorities.

Executives with Trelleborg Industrie S.A.S., Christian Caleca and Jacques
Cognard, pleaded guilty in November 2007 to charges stemming from their roles
in the conspiracy. In December 2007, each was sentenced to serve 14 months in
prison.

Francesco Scaglia and Val M. Northcutt, executives with Manuli Rubber
Industries SpA, were indicted in September 2007 in U.S. District Court in Fort
Lauderdale, Fla., for their roles in the conspiracy. The case is currently set
to go to trial in May 2008.

Two other foreign executives were arrested and charged in May 2007 - Vanni
Scodeggio, a business unit manager at Parker ITR srl in Italy, and Misao
Hioki, an executive involved in the sale of marine hose for Bridgestone
Corporation in Japan.

Law enforcement agencies from multiple foreign jurisdictions are investigating
or assisting in the ongoing matter.

The investigation is being conducted by the Antitrust Division's National
Criminal Enforcement Section, the Defense Criminal Investigative Service
(DCIS) of the Department of Defense's Office of Inspector General, the U.S.
Navy Criminal Investigative Service, and the Federal Bureau of Investigation.

"Price fixing and bid rigging are serious crimes that drain resources from the
Department of Defense and the American taxpayer. The Defense Criminal
Investigative Service takes very seriously all violations of U.S. antitrust
laws that affect products and services procured for our soldiers, sailors,
airmen and Marines. DCIS aggressively investigates those who seek to cheat the
DOD and the public by conspiring to suppress competition," said Charles W.
Beardall, Director, DCIS.

Gillespie is charged with a violation of the Sherman Act which carries a
maximum sentence of 10 years imprisonment and a fine of $1 million 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.

Today's charge is an example of the Department's commitment to protect U.S.
taxpayers from public procurement fraud through its creation of the National
Procurement Fraud Task Force. The National Procurement Fraud Initiative,
announced in October 2006, is designed to promote the early detection,
identification, prevention and prosecution of procurement fraud associated
with the increase in contracting activity for national security and other
government programs.

Anyone with information concerning bid rigging or other anticompetitive
conduct in the marine hose industry is urged to call the National Criminal
Enforcement Section of the Antitrust Division at 202-307-6694, or the Long
Beach, Calif. Resident Agency of the Defense Criminal Investigative Service at
562-256-2501.

SOURCE U.S. Department of Justice

U.S. Department of Justice Office of Public Affairs, +1-202-514-2007, TDD,
+1-202-514-1888