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AG DeWine Investigating Possible Bid Rigging in Water-Treatment Chemical Sales

4/20/2016

Ohio Attorney General Mike DeWine today announced that his office is investigating an alleged bid-rigging scheme involving sales of aluminum sulfate, or “alum,” a chemical used to treat drinking water and waste water.
 
Municipalities are urged to contact the Ohio Attorney General’s Office if they purchased alum or ferric acid between 1997 and 2010 for their wastewater or drinking water treatment.
 
“Many of Ohio’s local communities use alum to treat drinking water and waste water,” said Ohio Attorney General Mike DeWine. “We need information from local governments that have purchased alum to determine if they got a fair price or if the market was manipulated.”
 
Aluminum sulfate, otherwise known as “alum,” is a chemical used to treat both waste water and drinking water. It’s a coagulant (binding agent) that also is used by pulp and paper manufacturing companies.
 
Three executives of chemical manufacturing companies have been indicted in federal court in New Jersey for their alleged roles in a scheme to reduce competition in sales of alum. The alleged scheme involved competitors agreeing among themselves who would win a bid or who would submit the lowest bid (and thus be most likely to win) to sell alum to the purchaser.
 
Generally, bid-rigging schemes can cause taxpayers and government entities to pay artificially higher prices, because they don’t get the benefit of fair competition among vendors. 
 
The Ohio Attorney General is authorized by law to represent municipalities and public entities in antitrust matters such as this one. 
 
Municipalities and other public entities should contact the Ohio Attorney General’s Antitrust Section at 614-466-4328 or Alum_Investigation@OhioAttorneyGeneral.gov to learn more about the investigation and to provide information about their aluminum sulfate or ferric acid purchases.

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Media Contacts

Dan Tierney: 614-466-3840
Kate Hanson: 614-466-3840

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