SF businessman pleads guilty to federal bid-rigging charge

A business consultant from Vallejo will be sentenced in federal court in San Francisco on Jan. 23 for conspiring in a bid-rigging scheme concerning the renovation of a building at Lawrence Berkeley National Laboratory.

Derf Butler, 54, the owner of Butler Enterprise Group in San Francisco, pleaded guilty Wednesday before U.S. District Judge Charles Breyer to a charge of conspiring to defraud the federal government through the bid-rigging scheme between July 2013 and January 2014, according to U.S. Attorney’s Office spokesman Abraham Simmons.

Butler also pleaded guilty to a second count of lying to investigating FBI agents in March 2014 by denying he had received any money from the developer who was intended to submit the lowest bid.

SEE RELATED: More ‘Shrimp Boy’ fallout: Eight men indicted for alleged bid-fixing scheme

Butler admitted he had in fact received $15,000 from that individual and had asked for $15,000 more, Simmons said.

The maximum sentence for the two counts is 15 years in prison.

The individual who was supposed to submit the low bid of $5.2 million was in fact an undercover FBI agent who had also posed as a businessman in the investigation of Chinatown tong leader Raymond “Shrimp Boy” Chow and former state Sen. Leland Yee, D-San Francisco-San Mateo.

SEE RELATED: SF awards $3.2M in contracts to company connected to alleged bid-rigging, federal indictment

In that case, Chow was convicted of murder, racketeering and other charges and Yee and fundraiser Keith Jackson pleaded guilty to a corruption charge.

Three genuine developers were indicted along with Butler in 2017 on charges of participating in the bid-rigging conspiracy by purposely submitting higher bids ranging from $6.2 million to $7.1 million so that the agent posing as a developer could win the contract.

Anton Kalafati, 34, of San Francisco, President of B Side Inc. in San Francisco, pleaded guilty to the conspiracy charge in March. His sentencing date has not been set, Simmons said.

Conspiracy charges remain pending against Clifton Burch, 50, of San Lorenzo, president of Empire Engineering and Construction Inc.; and Peter McKean, 49, of San Mateo, vice president of Townsend Management Inc.

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