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Envelope Please: Checking Packaging for Signs of Collusion

A best practice that ensures fair and open competition as well as discourages collusion is the use of sealed bids in your purchasing process. It is important to note that the envelopes that house the bid documents are, in many cases, just as important as the bid documents themselves in the detection of collusion among competitors.

It is common for unscrupulous vendors to put a large amount of focus and attention into covering up signs of their collusive agreement within the bid materials that they are submitting; however, even the craftiest colluders often leave clues behind at some point that can aid in the detection of collusive behavior. In many instances, this clue will be left on the envelope or packaging because it is overlooked while focusing on the bid materials.

Some of the first clues that you may encounter are similarities in the appearance of the bid envelopes. These similarities may be found in the style of handwriting, typeface or font, identical spelling errors, white-outs, unusual postage or stamps, or identical postmarks on separately submitted bids. These similarities on two separate envelopes could be a clue that the same individual or company is submitting a sham bid on behalf of another “competitor.”

Other clues that can be found while looking at the envelope are whether or not the envelope has been torn, taped, glued, or stapled in an effort to reseal it. This could be an indication that the envelope or its contents were tampered with before its submission.

None of these clues alone are clear indicators that there is a collusive agreement between competitors, but they do serve as a starting point for paying closer attention to the contents. If something seems odd, make sure you note it in the bid files; keeping an updated and accurate log helps to identify patterns of these types of behaviors or clues.    

As a procurement agent, please “handle with care” when receiving, examining, and safeguarding bid envelopes and contents to ensure a fair and legal competitive bid process. If you suspect sham bids are being submitted, contact the Ohio Attorney General’s Office by submitting a tip on the Antitrust Bid-Rigging Web Tip Form, or call us at 614-466-4328.