Bid-Rigging Scheme: Understanding the Fraudulent Practice

Bid-Rigging Scheme

Question

Bid-rigging scheme occurs when:

Answers

Explanations

Click on the arrows to vote for the correct answer

A. B. C. D.

A

Bid-rigging scheme refers to a fraudulent practice in which conspiring parties manipulate the competitive bidding process to ensure that a particular vendor wins a contract. The scheme involves individuals or organizations that collude to suppress competition by submitting non-competitive bids, agreeing to refrain from bidding, or agreeing to divide the market, among other tactics.

Option A is the correct answer. An employee assists a vendor in winning a contract through the competitive bidding process. The employee may do this by providing confidential information to the vendor, such as the details of the other bids, allowing the vendor to adjust their bid accordingly. Alternatively, the employee may provide the vendor with an advantage in the bidding process, such as inside information about the project's specifications or by discouraging other bidders from participating.

Option B is incorrect because it describes a situation in which an employee does not assist a vendor in winning a contract through the competitive bidding process, which is not a bid-rigging scheme.

Option C is incorrect because it describes a situation in which an employee once assists a vendor in winning a contract through a single competitive bidding process. Bid-rigging schemes often involve multiple instances of collusion, rather than a one-time event.

Option D is also incorrect because it is identical to option C.

In summary, bid-rigging schemes are a form of fraud in which conspiring parties manipulate the competitive bidding process to ensure that a particular vendor wins a contract. In this scenario, an employee fraudulently assists a vendor in winning a contract through the competitive bidding process.