TriMark USA, LLC, a Mansfield-based foodservice company, has agreed to pay a record $48.5 million to settle federal allegations of a scheme to manipulate small veteran-owned businesses into giving them government contracts to which they were not entitled.
“This case demonstrates a shocking disregard for fair competition, small business rules and integrity in government contracts,” said U.S. Attorney Vanessa Waldref for the Eastern District of Washington, the office that prosecuted the case. alongside the Northern District of New York. “The fact that the money they were stealing was for disabled veterans is simply unconscionable.”
Two of TriMark’s wholly-owned subsidiaries, TriMark Gill Marketing and Gill Group, Inc., wrongfully obtained federal food service contracts between 2011 and 2021 that were for small businesses owned and operated by disabled veterans of the forces US armies, according to the Department of Justice.
TriMark is not a small company. They reported in 2015 that they were the first foodservice company to surpass $1 billion in revenue after a whopping $128 million in volume the previous year, a revenue stream that alone would have placed the one of the largest companies in the sector.
By comparison, the total revenue of the top 100 companies in the industry was $9.4 billion in 2020, according to Foodservice Equipment & Supplies magazine.
Recent contracts listed in TriMark’s portfolio include California Pizza Kitchen, catering services at the University of North Dakota and Oklahoma State Veterans Affairs Hospital.
The latter two were awarded to subsidiary Gill Marketing, which, according to the settlement agreement, specializes in catering equipment for military branches, VA medical centers, the Federal Bureau of Prisons and other federal agencies.
Between 2011 and 2021, according to prosecutors, the TriMark subsidiary manipulated three companies that belonged to the targeted category of small businesses owned by disabled veterans and destined for federal agency contracts to bid on the contracts, but in fact passed on the work and money at TriMark.
In at least one case, the actual company the government thought it would contract with kept only its small margin value, typically 1% to 5% of the total contract value, according to the document. of settlement. In December 2011, the owner of this company sent an email expressing concern about the schemes and received a response from a Gill Marketing representative asking him to “calm down and enjoy his weekend”.
Kimberley Rimsza, who was president of Gill Marketing, agreed to pay an individual fine of $100,000 for her direct role in the scheme.