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OFT offers olive branch to firms in bid-rigging scandal

Firms in construction cartels accused of £3bn worth of bid-rigging have been given a last-chance offer by the Office of Fair Trading (OFT) to avoid prosecution and a possible prison sentence.
A two-year investigation by the OFT uncovered anti-competitive deals worth a total of £3bn by 57 companies in the Midlands, Yorkshire and Humberside. Companies that go to trial and are found guilty could face fines of up to 10% of their global turnover. Company executives face up to five years in prison.Of the 57 companies investigated, 37 have applied for leniency by admitting their guilt and fully co-operating with all investigations. If the firm was the first in its cartel to admit to its part in the corrupt activity it could receive immunity from both fines and prosecution.The OFT has written to the remaining 20 companies, offering them reduced penalties of around 5% of global turnover, in return for admission and cooperation.Forms of bid-rigging, include 'cover pricing', where competitors agree their prices between one another to ensure a certain firm wins the job. The OFT also found evidence of 'bungs' passed between competitors to rig prices. According to an OFT spokesperson, investigations were instigated by clients procuring construction projects. Although the OFT would not confirm the projects or schemes involved it said that it was not specifically investigating highway maintenance, civil engineering and large infrastructure schemes.

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