Puerto Rico school bus company owners sentenced for rigging contracts

Four owners of Puerto Rico-based school bus companies were sentenced for their role in rigging bids to secure contracts, the U.S. Department of Justice said.

The four individuals were convicted in a 2017 trial in the U.S. District Court for the District of Puerto Rico in San Juan. A jury found that they had conspired to rig bids for public school bus transportation contracts in the municipality of Caguas from roughly August 2013 until May 2015. They were also found guilty of conspiracy to commit mail fraud and four counts of mail fraud for defrauding the municipality of Caguas to obtain school bus transportation contracts.

During the trial, the Justice Department said the four defendants carried out the conspiracy by allocating transportation route contracts awarded by Caguas. The defendants were accused of submitting fraudulent certifications and receiving award letters by certified mail in connection with the conspiracy.

Luciano Vega Martinez, Alfonzo Gonzales Nevarez and Rene Garay Rodriguez were each sentenced to to 12 months and a day in prison. Gavin Rivera Herrera was sentenced to a term of two years’ probation, the first six months to be served in home confinement after a departure based on the defendant’s medical condition. Restitution will be imposed on an amount decided at a later date.

“These transportation company owners lined their own pockets with public funds that were intended to provide essential services to at-risk school districts,” said Assistant Attorney General Makan Delarhim of the Justice Department’s Antitrust Division. “The sentences imposed today reflect the serious harm caused by the actions of the defendants who enriched themselves at the expense of schoolchildren and the American taxpayers.”

The sentencing are the result of a federal antitrust investigation into price fixing, bid rigging and other anticompetitive practices in Puerto Rico’s school bus transportation industry.