FBI targeting supply chain gougers within a wider swath of transportation

FBI Seal, FBI Targeting Supply Chain Gougers

FBI targeting supply chain gougers within a wider swath of transportation companies that it deems may be using supply chain disruption to gouge customers

The U.S. Department of Justice (DOJ) is now targeting a wider swath of transportation companies that it deems may be using supply chain disruption to gouge customers.

The initiative broadens the scope of the Biden administration’s heightened scrutiny of anti-competitive behavior in various industry segments, including transportation.

Assistant Director Luis Quesada of the FBI’s Criminal Investigative Division

Assistant Director Luis Quesada of the FBI’s Criminal Investigative Division

“The lingering challenge of supply chain disruptions from the COVID-19 pandemic has created an opportunity for criminals to fix prices and overcharge customers,” said Assistant Director Luis Quesada of the FBI’s Criminal Investigative Division. “The FBI and our law enforcement partners will continue to collaborate and investigate schemes that violate our antitrust laws and stifle our economic recovery.”

As part of the initiative, DOJ’s Antitrust Division is prioritizing existing investigations where competitors may be exploiting supply chain disruptions for profit and is “undertaking measures to proactively investigate collusion in industries particularly affected” by supply chain disruptions, the agency warned.

“For those who seek to exploit supply chain disruptions for their own illicit gain, the Antitrust Division, along with the FBI, will investigate and prosecute criminal violations of the antitrust laws, including agreements between individuals and businesses to fix prices or wages, rig bids or allocate markets.,’’  the agency said in a press release.

Up to now, DOJ’s stepped-up oversight of anti-competitive behavior in the transportation sector has focused on the maritime industry and railroads, where there has been evidence that the relatively few players have wielded their market power to raise rates.

In July, DOJ and the Federal Maritime Commission signed a first-time agreement to sharpen economic oversight of foreign ocean carriers serving in the U.S. international container trades. The agreement came days after President Joe Biden signed an executive order aimed at curbing potential anti-competitive behavior among 72 industries, including among ocean carriers and freight railroads.



Photo by Jared Murray on Unsplash, FBI Targeting Supply Chain Gougers

FBI Targeting Supply Chain Gougers …February announcement should now put companies involved with trucking, warehousing, 3PLs and last-mile delivery on notice as well, according to one trade expert.

But the February announcement should now put companies involved with trucking, warehousing, 3PLs and last-mile delivery on notice as well, according to one trade expert.

Gerald Morrissey, a partner with the law firm Holland & Knight

Gerald Morrissey, a partner with the law firm Holland & Knight said “This is really saying that any company in the supply chain, particularly those that are not subject to some form of antitrust immunity – such as ocean carriers and marine terminals — could be in the crosshairs for potential complaints by customers or competitors with this increased focus from DOJ.”

“Certainly the focus here is on other elements of the supply chain that haven’t gotten as much attention as ocean carriers and marine terminals but are needed to get cargo to and from inland destinations,” said Gerald Morrissey, a partner with the law firm Holland & Knight.

“This is really saying that any company in the supply chain, particularly those that are not subject to some form of antitrust immunity – such as ocean carriers and marine terminals — could be in the crosshairs for potential complaints by customers or competitors with this increased focus from DOJ.”

As part of the initiative, the antitrust division has formed a working group with the Australian Competition and Consumer Commission, the Canadian Competition Bureau, the New Zealand Commerce Commission, and the United Kingdom Competition and Markets Authority, focusing on collusion in global supply chains.

“The working group is developing and sharing intelligence, utilizing existing international cooperation tools, to detect and combat collusive schemes,” DOJ said.


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