Does cover pricing happen here? Of course not!

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. 'Price distortions'The fines were largely for the practice known as "cover pricing". This
is where building firms submit quotes for jobs that are not actually
priced to win the contract, so the client gets a misleading idea about
the real extent of competition. The process will often involve builders disclosing to one another what price they intend to quote. In 11 instances, the OFT 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
infringements affected building projects across England worth in excess
of £200m, including schools, universities and hospitals, between 2000
and 2006. The OFT said that 83 out of the 103 firms had
received reductions in their fines because they had already admitted
the practice. "Our investigation has uncovered significant
infringements of competition law on nearly 200 projects across
England," said Simon Williams at the OFT. "Bidding processes
designed to ensure clients and in many cases taxpayers receive the best
possible choice and price were distorted, creating a real risk of
increased prices."