OFT offers £100,000 reward for exposing cartels

The Office of Fair Trading (OFT) is offering rewards of up to £100,000 for information that enables it to take action against cartels which are prohibited under the Competition Act.

Businesses found to be taking part in a cartel to collude on prices can be fined up to 10% of their turnover. The Enterprise Act also makes it illegal for individuals to take part in such anti-competitive activity with offenders facing penalties such as an unlimited fine and/or up to five years in prison.

The OFT says clamping down on cartels in now one of its priorities. Simon Williams, OFT Senior Director of Cartels and Criminal Enforcement, said: “Cartels are very damaging both to businesses and consumers and they are usually conducted in secret making them hard to detect.

“Cartels are not the preserve of big business - for example, if a local authority needs to find a contractor to refurbish its schools, it is unacceptable for local contractors to seek to rig the tender process by colluding on price. That's bad for taxpayers, consumers and other businesses."

“We believe that it is in the public interest to offer financial incentives in the hope that it will encourage more people who have good information about the existence of hard core cartel activity to come forward, and in exceptional circumstances these incentives may be as high as £100,000.”

The reward system will be tried out for 18 months before deciding whether it should become a permanent arrangement.