Manipulation of bids

In the bidding process competitors can manipulate bids by false statements on qualifications in order to win the bid or increase (personal) profits.

Risk type: Practice

Risk driver: External

DESCRIPTION

Competing bidders can manipulate the bid by furnishing false documentation in order to win a contract. This risk is also known as fraudulent contractor qualification. Common false statements can concern the competing bidder’s financial condition (false financial statements, inflated sales amounts or account balances, etc.), its track record, or its employees’ educational or professional credentials. For example, a competing consulting firm can include a highly qualified consultant in its bid, and replace the consultant with a less qualified and less expensive person after being awarded the contract. This is a very common scheme by bidders not only to win contracts but also to increase profits of contracts later on.¹

RED FLAGS

• Competitors win contracts for which they have no apparent qualification¹

KEY GUIDING DOCUMENTS

IACRC, 2015, Collusive bidding schemes, Guide to Combating Corruption & Fraud in Development Projects, International Anti-corruption Resource Center (IACRC), http://guide.iacrc.org/potential-scheme-collusive-bidding/, accessed 15.10.2015

FULL REFERENCES

1. IACRC, 2015, Collusive bidding schemes, Guide to Combating Corruption & Fraud in Development Projects, International Anti-corruption Resource Center (IACRC), http://guide.iacrc.org/potential-scheme-collusive-bidding/, accessed 15.10.2015