Roofing firm Briggs exposed the illicit cartel it was involved in to OFT after being blackmailed over its activities.
A roofing contractor that turned whistleblower in an investigation into price fixing may have supplied information to the Office of Fair Trading because an individual was threatening to blackmail it over these prohibited activities.
The news comes after the OFT pledged to step up its investigations into sectors in the construction industry.
Building understands a company that disclosed vital information to the OFT about illicit cartels in the roofing industry went to the agency after it received the blackmail threat. The person told the firm, Midlands contractor Briggs Roofing & Cladding, that he would tell the authorities what he knew unless he was paid a sum of money.
Briggs refused to be coerced in this way by the individual, who cannot be identified for legal reasons, and instead went to the OFT itself. The agency agreed that the firm would be exempted from any sanction if it co-operated fully with an inquiry.
The OFT carried out two investigations into collusion in the roofing sector, one in the West Midlands and one in the North-east. A number of firms were found guilty of collusion, conduct sanctioned by the terms of the Competition Act 1998, and fined by the OFT.
A possible clue to the attempted blackmail emerged in a statement submitted by Briggs during the OFT’s West Midlands investigation. In a submission to the OFT inquiry Briggs stated that the firm had received a letter alleging it had been involved in anti-competitive activities over some roofing contracts. The statement says: “The management of Briggs carried out an internal investigation to ascertain the truth of the allegations.”
A source close to Briggs said: “Once made aware of the possible collusion charges the management of Briggs became the first roofing firm through the door at the OFT and because of this struck a deal, the essence of which was that it would not be fined because it had co-operated fully.”
Dave McGuinness, Briggs’ managing director, said he could not comment because of the confidential nature of the matter. However, a source close to the company reiterated that a new management team had been put in place at Briggs and its practices had changed since the OFT inquiry began four years ago.
The OFT’s report into price fixing in the North-east, which was published this week, acknowledged that it had received help from Briggs and that this accounted for the leniency shown to it. The document said that the OFT was aware of an internal inquiry into anti-competitive activities at Briggs and the remedial action it had taken.
Nine firms were fined by the OFT for collusion in the West Midlands. They were: Briggs, Apex, Brindley, General Asphalte, Howard Evans, Price, Redbrook, Rio and Solihull. Each was fined £17,000-£45,000.
In the North-east, seven firms were fined including Briggs, Dufell, Hodgson & Allon, Hylton, Kelsey, Roofclad and Single Ply. Briggs received fines in both inquiries but both were quashed by the OFT.