What’s behind your lunch? Part II

From scrapes with federal authorities, to cigarette price fixing, to “Ninny the Torch,” Aramark serves up a buffet of controversy.

John Hoff

The company which currently runs your campus dining service, Aramark, started as two guys in the vending machine business in 1959, keeping their inventory of peanuts in the back of a 1936 Dodge. They had a crazy dream: Let’s put vending machines where they’ve never been before, inside offices and factories. In one sense, it’s the story of the American dream come true.

Today Aramark is a “$6 billion world leader in providing managed services” with 150,000 employees. Aramark employees drive school buses, care for the elderly, run medical facilities in state prisons and serve up food in cafeterias ranging from yummy to, well, not yummy.

They have also been accused by the Federal Trade Commission of price-fixing, investigated by the Department of Justice and accused by a former employee of infiltration by organized crime.

Aramark (formerly known as ARA Services) was forced, under a consent order with the FTC, to divest itself of vending machine companies with $7.7 million in revenue, according to a Sept. 30, 1981, Wall Street Journal article, “Image Problems: ARA Tries to Deal With Its History of Legal Scrapes.” This company running your campus dining has been accused of “conspiring to kill competition by submitting below-cost bids to clinch a contract, with the intention of raising prices once the competition (has) gone out of business.” This was, admittedly, in the busing industry, not the college dining industry, but allegations have been made that this is the company’s basic pattern, to unfairly conspire to snuff out the little guys and then move in to the lucrative territory. The company has been forced to pay huge fines for violating consent orders, including charges of cigarette price-fixing.

One Web site concerned with campus food services at Massachusetts Institute of Technology says that “MIT must decide whether to renew its contract with an unscrupulous and lawbreaking dining services provider.” The Web site, however, appears out of date. Another Web site, which turns up quickly if you search under “Aramark sucks,” documents extensive complaints at Claremont McKenna College in Claremont, Calif. This Web site also appears quite out of date, like the one at MIT.

According to an investigation ARA did of itself, “some employees had received $504,000 in rebates from milk suppliers, from beer and liquor suppliers and in ocean shipping business.” ARA was sued by a former employee named Peter O’Neill, a former FBI agent who says he was hired by the company to investigate charges of organized crime connections. O’Neill told the company “that an ARA vending subsidiary had been infiltrated by organized crime, and he described what he said were questionable loans made by the subsidiary bar owners by suspected mobsters in Detroit.” A former ARA executive named Mr. Zemba seems to have almost made a cottage industry out of testifying against ARA. Another “ARA gadfly” was Lewis Edwards, who owned a bus company in Boston at the time of the 1981 Wall Street Journal article. Edwards was known to put together a “morgue file” of negative clippings about ARA, which he would send to entities considering a contract with the company.

A book published by the American Federation of State, County and Municipal Employees, “Passing the Bucks,” goes into even more detail about the company’s alleged mob connections, dropping names like Alfred Miniaci, a suspected underworld figure and associate of the late Frank Costello, called “the kingpin of the mob’s illegal gambling activities.” In fairness to the company, they have repeatedly and categorically denied ties to organized crime. Some commentators say the company’s early roots in the rough and tumble world of vending machines have led to undue scrutiny of mistakes. In one instance, the company was not caught by the U.S. Security and Exchange Commission but instead voluntarily admitted “questionable and sometimes illegal payments in the United States and abroad between 1970 and 1976.” Furthermore, much of the information about Aramark is quite old. In fact, it’s so old that it always references “ARA,” the company’s former name, under which I, like tens of thousands of other college students, was employed.

My job was at a hotel in a national park. During my free time, I would pick blueberries or hike to scenic waterfalls. While employed by ARA, I consistently heard rumors about influence by the mob, but I learned to just shut my mouth and cash my check. I didn’t mind sleeping near a waterfall, but I didn’t want to sleep with the fishes.

There are two sides to the Aramark story. A Nov. 25, 1997, article from the Pittsburgh Post-Gazette makes Aramark appear more like the hapless victim of organized crime. Members of a union in Pittsburgh, which operated Aramark merchandise stands in the Civic Arena, were accused of “embezzlement and knowing association with members or associates of a criminal group.” One member of the group was “the late Anthony J. Lagatutta, who was known as Ninny the Torch.” In any case, the old problems remind me of something I learned as a novice journalist, “Old shit doesn’t stink unless you stir it up.”

Aramark’s colorful history of legal scrapes may be in the past, but is this the company we want running our campus dining service in the future?

John Hoff welcomes comments at [email protected] Opinions Editor Karl Noyes assisted in researching this column.