A former high-ranking executive at a leading steel trader in Puerto Rico pleaded guilty today to participating in a long-running conspiracy to fix the prices of rebar sold on the island, the U.S. Department of Justice said in a statement.
Juan Carlos Aponte Tolentino, a resident of Bayamon, Puerto Rico, was interim president of a prominent steel distribution company that, along with two other competitors, controlled about 70% of the wholesale rebar market in Puerto Rico. Rebar, a key material for residential and commercial construction projects on the island, is predominantly imported from the continental United States or other countries.
According to court documents filed in U.S. District Court in San Juan, Aponte admitted to conspiring with other companies and individuals to suppress competition through price fixing for rebar and other steel products between 2015 and 2022. This period in particular coincides with the critical reconstruction period following Hurricanes Irma and Maria in September 2017. The price fixing targeted home improvement stores, contractors and other businesses and generated significant profits for the conspirators.
According to the settlement, Aponte and his competitors frequently communicated via WhatsApp, exchanging messages to coordinate pricing strategies. In one case in December 2020, a manager at a rival company sent Aponte a message with the price of Turkish rebar. Aponte responded by listing specific prices for different quantities and asking, “The question is, do we agree?” The competitor’s manager confirmed, “Yes, that’s what I do.”
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Aponte acknowledged that the conspiracy impacted his company’s revenue by more than $100 million, the statement said.
Commenting on the guilty plea, Assistant Attorney General Manish Kumar of the Justice Department’s Antitrust Division said: “In his guilty plea, this defendant admitted to colluding for nearly a decade on the prices of rebar, a vital part of the supply chain for Puerto Rico’s reconstruction following the 2017 hurricanes. This guilty plea demonstrates the Antitrust Division’s continued commitment to holding accountable those who collude to inflate construction prices and harm consumers and businesses in Puerto Rico. We and our law enforcement partners will continue to prosecute those responsible for this type of anticompetitive criminal conduct.”
Special Agent in Charge Joseph Gonzalez of the FBI’s San Juan field office also praised the outcome, noting that it “sends a clear message that price fixing and the exploitation of communities in crisis situations will not be tolerated.” He also stressed the FBI’s determination “to stop this illegal practice and bring justice to all those affected by such unethical practices.”
Violations of the Sherman Act, a federal antitrust law, are considered crimes. Individuals convicted under the law face a maximum penalty of 10 years in prison and a $1 million fine. Corporations can be fined up to $100 million.
Source: Minister of Justice
