Which of the following is NOT a common red flag of procurement fraud schemes involving collusion among contractors?

• A. There is limited competition within the industry.
• B. The same contractors bid on each project or product.
• C. Bid prices begin to fall when a new competitor enters the competition.
• D. More competitors than usual submit bids on a project or product.

Answer: (D)

When bidders collude, you expect to see signs of limited competition and coordinated behavior, such as only a few players consistently bidding and predictable pricing patterns. Limited competition within the industry is a red flag because it suggests a small group may be rigging the process. The same contractors bidding on each project or product is another red flag, reflecting a bid-rigging arrangement where the same players rotate wins or fix outcomes. Prices that begin to fall when a new competitor enters would disrupt a collusive scheme and thus is also a red flag, signaling that the usual collusion is being challenged. In contrast, more competitors than usual submitting bids indicates genuine competition, which is not what you’d expect in a collusive scheme, so it is not a common red flag.