Cleveland scrap dealer pleads to anti-trust charges. (Scrap Industry News).

An ongoing federal Justice Department anti-trust investigation in the Cleveland area has resulted in a substantial fine for another northern Ohio scrap dealer.

Howard B. Bahm, former president of Harry Rock & Co., will pay a $1 million fine and faces a jail sentence of up to 37 months, according to a report in the Cleveland Plain Dealer. The guilty plea is the second resulting from the Justice Department investigation into charges that scrap metal companies participated in schemes to divide up generators and rig bids for scrap metals in northeast Ohio.

The charges related to Bahm covered activities from 1993 to 2000 and involved about $104 million in purchases of scrap metal by Harry Rock & Co., according to documents in U.S. District Court in Cleveland.

Bahm eventually agreed to cooperate with the investigation. The court will determine the sentence and whether to accept the plea and impose the $1 million fine.

The same investigation resulted in Bay Metal Inc., Richfield, Ohio, pleading guilty early last year and paying an $850,000 criminal fine for participating in a conspiracy to rig prices paid for scrap metal. That dealer and two of its executives also agreed to cooperate with the government's investigation.

Earlier this year, attorney Robert W. Doyle Jr. of Powell, Goldstein, Frazer & Murphy LLP, Washington, told Recycling Today that scrap generators are the likeliest sources of complaints to trigger investigations such as the Justice Department one in northern Ohio.

"The generator of scrap is the injured party," he remarks. "He'd like as many competitive bids as possible, but this exchange of information that occurs can diminish those prospects."

In addition to the Ohio case, a Florida case, United States v. Atlas Iron Processors, Inc., et al., resulted in two Miami-based scrap companies and four of their executives being tried and convicted in February 1999 for conspiring to fix prices of scrap metal in the Miami area immediately following Hurricane Andrew.

In the Atlas case, the companies' fines and restitution payments exceeded $1 million. Each individual was also fined more than $30,000 and received a one-year prison term.