Procurement Collusion Strike Force to target bid-rigging

7 November 2019

The US is to step up oversight of public procurement through a new multi-agency, the Procurement Collusion Strike Force (PCSF), which aims to target antitrust crimes such as bid-rigging.

Assistant attorney general Makan Delrahim of the Department of Justice’s Antitrust Division told a press conference that the PCSF will be made up of prosecutors from the Antitrust Division and 13 US Attorneys’ Offices and investigators from agencies including the FBI.

Deputy attorney general Jeffrey A. Rosen said: “To protect taxpayer dollars, the Justice Department is doing its part to eliminate anticompetitive collusion, waste and abuse from government procurement. 

“To ensure taxpayers [receive] the full benefits of competitive bidding, experienced investigators and prosecutors with the necessary expertise will partner in this strike force to deter, detect and prosecute antitrust crimes and related schemes in government procurements.”

The PCSF aims to train procurement officials across the US to recognise and report suspicious conduct in procurement, grant and programme funding processes.

It will also hold outreach and training for procurement officials and government contractors on antitrust risks in the procurement process.  

Delrahim said that more than one third of the Antitrust Division’s 100-plus open investigations relate to public procurement or criminal activity against the government.

He estimated that roughly $1 out of every $10 of federal spending is allocated to government contracting, adding the federal government spent more than $550bn, or about 40% of all discretionary spending, on contracts for goods and services. 

He said the PCSF would work on ways to improve use of data analytics programmes to identify potential “red flags” of collusion in government procurement data. 

“Many investigative agencies individually have made great strides on this front, and the PCSF will serve to facilitate collaboration and the sharing of best practices between these agencies,” he added.

In late 2018 and early 2019 the Antitrust Division investigated five South Korean oil companies which finally agreed to plead guilty for being involved in a decade-long bid-rigging conspiracy that targeted contracts to supply fuel to U.S. military bases in South Korea. 

The Antitrust Division has posted a notice in the Federal Register which invited the public to comment on a PCSF complaint form, which will make it easier for the public to report complaints, concerns, and tips regarding potential antitrust crimes around government procurement.

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