TriMark USA, LLC, a Mansfield-based food services 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 they weren’t entitled to.

“This case demonstrates a shocking disregard for fair competition, small business rules and integrity in government contracting,” 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 intended for service-disabled veterans is simply unconscionable.”

Two of TriMark’s wholly-owned subsidiaries, TriMark Gill Marketing and Gill Group, Inc., were improperly awarded federal food servicing contracts between 2011 and 2021 that were earmarked for small businesses owned and operated by service-disabled veterans of the U.S. armed forces, according to the Department of Justice.

TriMark is not a small company. They reported in 2015 that they were the first food service company to surpass $1 billion in revenue after a whopping $128 million volume increase the previous year, a revenue stream that alone would have placed the company as among the biggest in the business.

In comparison, the total revenue of the top 100 businesses 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, dining services at the University of North Dakota and the Oklahoma State Veterans Affairs Hospital.

The latter two were awarded to the Gill Marketing subsidiary, which, according to the settlement agreement, specializes in foodservice equipment for military branches, VA medical centers, the Federal Bureau of Prisons and other federal agencies.

Between 2011 and 2021, prosecutors say, TriMark’s subsidiary manipulated three businesses that were in the targeted service-disabled, veteran-owned small businesses category intended for the contracts by federal agencies to bid on the contracts but actually passed the work and the money on to TriMark.

In at least one company’s case, the actual company the government thought it was contracting with kept only its small markup value, generally 1% to 5% of the total contract value, according to the settlement document. That company’s owner in December 2011 sent an email expressing concerns over the schemes and received a reply from a Gill Marketing representative to “calm down and enjoy your weekend.”

Kimberley Rimsza, who was the president of Gill Marketing, has agreed to pay a $100,000 individual penalty for her direct role in the scheme.