Competition Matters
Media > Newsletters > Competition Matters > October 2020 > Buy, Sell, Bid Rig, or Price-Fix: Anticompetitive Conduct in the Foreign Exchange Trade

Competition Matters Competition Matters RSS feeds

Buy, Sell, Bid Rig, or Price-Fix: Anticompetitive Conduct in the Foreign Exchange Trade

State and federal antitrust enforcers investigate various kinds of anticompetitive conduct that impede free and fair competition, and disadvantage consumers. For instance, one type of anticompetitive conduct is bid rigging, which occurs when bidders undermine the competitive bidding process by colluding to determine who will win the bid. Another type of anticompetitive conduct is price-fixing, which occurs when two or more competing businesses conspire to set the prices of goods or services at certain price points. Bid rigging and price-fixing often result in market inefficiencies, causing consumers to pay higher prices or tolerate deficient goods or inadequate services. 
It is important to note that bid rigging or price-fixing can occur in a variety of contexts. From real estate to consumer goods and services, no facet of society is immune from the potential harms that rigging bids or fixing prices can inflict. As described below, bid rigging or price-fixing can even cause trouble on a global scale.
In September 2020, Askshay Aiyer, a former currency trader at a multinational bank, was sentenced in federal court to serve eight months in prison and ordered to pay a $150,000 criminal fine for participating in an antitrust conspiracy whereby he colluded with other currency traders to fix the prices of and rigs bids on Central and Eastern European, Middle Eastern, and African currencies, which are generally traded against the United States Dollar and the Euro.
According to evidence presented at trial, Aiyer communicated constantly with his co-conspirators from at least October 2010 through at least January 2013 by phone, text, or electronic chat room to manipulate bids or offers to avoid adverse effects from the exchange rate, share customer information, and coordinate trading to increase their profits at customers’ expense. Additionally, the jury heard evidence that Aiyer and his co-conspirators deliberately concealed their actions by using code words, communicating on their personal mobile devices during work hours, and meeting in person.
The anticompetitive conduct that Aiyer and his co-conspirators perpetrated is reminiscent of the acts that unscrupulous vendors commit against public purchasers. As such, to help discourage anticompetitive activity and increase detection, one should:
  • Keep an up-to-date list of potential bidders; solicit bids from as many competitors as possible.
  • Require bidders to identify partners, subcontractors, and joint ventures in their bids.
  • Require non-collusion affidavits with every bid.
  • If something looks strange, ask bidders to explain.
  • Retain bid and purchase records for at least five years, allowing for review.
  • Not reveal the names of prospective bidders or cost estimates before the contract is awarded.
If you suspect unscrupulous behavior, or have questions about how to recognize anticompetitive activity, please call the Antitrust Section of the Ohio Attorney General’s Office at 614-466-4328.