Module 3: Common types of corruption in project procurement

Abuse of procurement procedures - Examples 1

This page, and the following pages, give examples of abuse of procurement procedures which are likely to involve one or more of the following corruption offences:

fraud and abuse of power (committed by the procurement manager in breaching the procurement procedures so as to provide the favoured bidder with an advantage)
bribery (committed by the favoured bidder and by the procurement manager) (In cases where a bribe was given by the bidder to the procurement manager)
(in the cartel case) a cartel offence by all bidders who were parties to the cartel, and a fraud offence by all bidders who made a false representation in their bids that their prices were genuine.

Eliminating likely winners in advance of bids

In a pre-qualification process which assesses potential bidders’ technical or financial capability in advance of permitting them to bid, the procurement manager overseeing the bid process may corruptly evaluate the pre-qualification in a manner which results in the likely winners of the bid being eliminated in advance of bid submission.
This makes it easier for the procurement manager’s favourered bidder to win the subsequent bid.

Creating a false appearance of competition

Creating fictitious bidders: A procurement manager may corruptly create fictitious bidders and fictious bid documents so that it appears that the necessary number of competitors have submitted bids. However, only the procurement manager’s favoured bidder actually submits a bid. The fictitious bids are at a higher price, so the favourered bidder wins.
Cartels: Bidders may corruptly and secretly agree with each other as to which of them will win the bid. The other bidders then submit bids at a higher price than the pre-selected winner. It therefore falsely appears that there has been a genuine competitive bid.

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