The owner of any business bidding for government contracts knows that government contracts can be tough to obtain. The process involves having to meet demanding bid requirements and gaining approval can seem mysterious.
The chance for unfair practices also permeates the process. Businesses need to be aware of the potential for illegal and unfair bidding practices that can occur in government contracts.
Common problems with government contract bidding
Numerous problems exist within government contract bidding. Some of them are illegal, and some are not. You need to be aware of red flags in the process, so you can recognize unfair and fraudulent practices when you see them.
According to the Association of Corporate Counsel, potential for fraud occurs at every part of the procurement lifecycle, and issues can include:
- The rigging of bids: Commonly, this would mean a business bidding on a contract and the public official created an agreement ahead of time saying that a specific business will win the bid.
- Bribery: In some cases, a business will bribe a public official to win the bid.
- Collusion between bidders: Two companies bidding on the same project can agree in advance that they will share the work and the profits if either business wins the bid.
- Excessive or unneeded goods or services: The call for bids could exist under illicit circumstances if the work calls for goods or services far beyond what is needed or outside of the scope of what is needed.
- False statements or claims: Either the agency calling for bids or another company bidding might make false – and thus, illegal – claims that could hinder your business’s ability to win the contract fairly.
If you recognize any of these practices during bidding for a government contract, you may feel discouraged. However, there are steps you can take.
What can you do if you lost a bid unfairly?
Fair and equal opportunity exists as a central tenet of the laws regulating government contracts. If you have evidence that you lost a bid due to unfair or illegal practices, you can protest the bid. According to the U.S. Government Accountability Office, a bid protest is “a challenge to the award or proposed award of a contract for the procurement of goods and services or a challenge to the terms of a solicitation for such a contract.”
A skilled business lawyer with experience handling cases involving government contracts can help you determine your rights and options. For a large bid that could be lucrative to your company, it is worth the time to explore a possible bid protest to protect your business’s financial interests.