United States Attorney's Office District of Connecticut
Press Release

TWO EMPLOYEES OF ALLIED WASTE PLEAD GUILTY TO FEDERAL RACKETEERING CONSPIRACY CHARGE

Kevin J. O’Connor, United States Attorney for the District of Connecticut, announced that JEREMY EVERETT, age 31, of 142 Thoreau Drive, Shelton, Connecticut, and SCOTT McGOWAN, age 37, of 2 Morningside Avenue, Yonkers, New York, each pleaded guilty today before Senior United States District Judge Ellen Bree Burns in New Haven to one count of conspiring to violate the federal Racketeer Influenced and Corrupt Organizations Act (RICO). During the period charged in the Indictment, EVERETT was the sales manager at Allied Waste and McGOWAN was Allied Waste’s manager of the Mt. Kisco Transfer Station in Mt. Kisco, New York.

According to documents filed with the Court and statements made in court, EVERETT and McGOWAN today admitted that, along with others, they conspired to perpetuate a system, commonly called the “property rights system.” Carters engaged in the property rights system would not service or compete for other carters’ customers. The property rights system essentially destroys free enterprise, allowing the participating carters to artificially inflate their prices and leaving waste removal customers with no other options. In this scheme, which was directed at commercial and municipal customers, participating carters agreed to quote inflated prices to customers controlled by other carters. EVERETT and McGOWAN admitted that they participated in the affairs of the enterprise by agreeing to respect the unwritten rules of the property rights system.

According to statements made by the Government at during today’s court proceedings, the property rights system in Connecticut was enforced by extortion and threats, and some participants in the conspiracy sought to operate the property rights system in eastern New York. To accomplish this goal, they spoke with a number of New York carters and arranged a meeting at a diner in Mr. Kisco, New York, in December 2004. The meeting was attended by two individuals associated with a Connecticut-based carting company and two members representing New York-based carting companies. EVERETT and McGOWAN did not attend the meeting. At this meeting, a member of the enterprise proposed that the carters attending the meeting and others agree to inflate prices for New York carting services and displayed a piece of paper that listed a suggested price. Telephone calls intercepted both before and after this meeting demonstrate that a co-defendant who attended the meeting apprised EVERETT of the agreement to inflate prices, and EVERETT agreed to honor the agreement to quote inflated prices.

Following the meeting, EVERETT engaged in a series of telephone calls with other members of the enterprise concerning their efforts to effectuate a property rights system. On December 20, 2004, law enforcement intercepted one conversation between EVERETT and a co-defendant affiliated with a Connecticut-based carting company during which EVERETT was advised that he should quote the agreed-upon higher price.

In addition, intercepted telephone conversations revealed that EVERETT and McGOWAN each participated in a plan to help a co-conspirator punish a competing trash hauler, who did not participate in the property rights system, by preventing the competitor from using the Mt. Kisco Transfer Station. In November 2004, McGOWAN accepted eight luxury box tickets to a New York Giants football game from the co-conspirator and agreed to “lock out” the competing trash hauler from the transfer station.

On June 8, 2006, a federal grand jury in New Haven returned and indictment charging EVERETT, McGOWAN and several other individuals and businesses on various charges stemming from a long-term investigation in the waste-hauling industry in Connecticut and eastern New York. Today, both EVERETT and McGOWAN pleaded guilty to Count Two of the Indictment.

EVERETT and McGOWAN each faces a maximum term of imprisonment of 20 years and a fine of up to $250,000 when they are sentenced, currently scheduled for May 16 and May 17, respectively.

This matter is being investigated by the Federal Bureau of Investigation, the Internal Revenue Service – Criminal Investigation Division, the United States Department of Labor, Office of Labor Racketeering and Fraud Investigations and the Connecticut State Police. Assistant United States Attorneys Raymond F. Miller, Michael J. Gustafson, Anthony E. Kaplan, and Henry K. Kopel are prosecuting this case.

CONTACT:

U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
thomas.carson@usdoj.gov