Ethics & Corruption
UK Demolition Firms Fined $75M in Bid-Rigging Crackdown
The historic Bow Street Magistrates' Court in London was one project caught up in the UK bid-rigging scheme involving demolition contractors.
Photo Courtesy Wikipedia / Public Domain
Ten U.K. demolition contractors have been fined nearly $75 million for bid rigging on 19 contracts with a combined value of $185 million. The nation's Competition and Markets Authority also disqualified three former and current directors of two of the firms from holding senior corporate posts for up to 7.5 years for "the unlawful conduct."
Each of the firms was involved in bid rigging between January 2013 and June 2018. Projects included the high-profile remodeling of London's historic Bow Street Magistrates' Court and a police training college. At least two of the firms have since ceased operations.
According to the authority, the corrupt bids were set at levels sure to lose, allowing one company to scoop up the target contract. Five of the firms were, at least once, involved in compensating "losers" with payments exceeding $600,000 in one case.
Eight firms received reduced fines, after admitting culpability. They include Keltbray Group, which still received the second biggest penalty of about $20 million.
Keltbray's fine was based on total group sales "rather than the actual level of culpability relevant to the [now defunct demolition] subsidiary," commented group CEO Darren James. The company plans an appeal to have the penalty reduced.
"The construction sector is key to our country’s prosperity," noted Michael Grenfell, the authority's executive director for enforcement. The authority "will not tolerate unlawful conduct, which weakens competition and keeps prices up at the expense of businesses and taxpayers."
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