"Some of the UK's leading building companies have been handed big fines by the Office of Fair Trading (OFT) for rigging bids for contracts.

The OFT has fined a total of 103 firms £129.5m for colluding with competitors on building contracts. It said the firms colluded among themselves during the bidding process, leading to customers, such as local authorities, having to pay too much.

The ruling comes at the end of a five-year investigation by the OFT.

.... Adam Aldred, competition partner at law firm Addleshaw Goddard, which represents five of the firms investigated, said the OFT was the first competition authority in Europe to rule against building firms for the practice of cover pricing.

'Price distortions'
In 11 instances investigated by the OFT, the body found that the lowest bidder faced no competition because all other bids were cover bids. It also found six instances where successful bidders had paid an agreed sum of money to the unsuccessful bidder. These payments were between £2,500 and £60,000 and were made using false invoices. "

The best bit..................

"....The UK Construction Group, which represents 29 contractors, called the decision to penalise the firms "unfair".
Deborah Jones, OFT: "It's a breach of competition law"

"Everybody knows - including the OFT - that cover pricing was widespread in the industry in the past," said the body's director Stephen Ratcliffe. "