OFT hits construction sector with fines
As we covered in one of our articles yesterday, the Office of Fair Trading (OFT) has today issued a report into an alleged cartel in the construction industry which was rumoured to involve over 100 different companies. The report confirms evidence that prices were rigged during the tender process with many parties agreeing to introduce higher offers to mask the real cost of the project in question. However, the fines totalling £129.5 million are far less than the £200 million indicated just 24 hours ago and many people believing that the OFT effectively backed out at the last minute.
When you consider the contracts in question date back as far as 2000 and were worth anything between £200 million and £3 billion then maybe the fines do not fit the crime?
The problem is that the cartel has potentially cost UK taxpayers hundreds of millions of pounds because the vast majority of the contracts under review were of a public sector nature. So while the authorities now appear to have laid the matter to rest, UK taxpayers are today nursing substantial losses on top of the ever-growing budget deficit and national debt. There have been concerns that construction companies would take legal action if fines were deemed to be "over the top" which is probably why the OFT has been a little cautious.
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