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The Competition and Markets Authority has made public details of why three directors of demolition firms have been banned for a total of nearly 18 years following its probe into bid-rigging in the sector.

The revelations include how one director set up a firm to receive 拢175,000-worth of so-called 鈥渃ompensation鈥� payments, how another agreed to a 拢500,000 payment in return for his firm taking a 鈥渂ack seat鈥� bidding a job and a how a third was involved in bid-rigging on jobs totalling nearly 拢60m.

The shocking details are revealed in an update on the cartel-buster鈥檚 website spelling out why it has banned Cantillon founder Michael Cantillon, David Darsey, a former managing director of Erith, and a previous president of the National Federation of Demolition Contractors, and Paul Cluskey, the managing director of Cantillon, from being company directors.

Announcing last month that 10 firms had been fined nearly 拢60m for their involvement in the scandal, the CMA said 鈥渂ids were rigged by one or more construction firms which agreed to submit bids that were deliberately priced to lose the tender [known as cover pricing]鈥�. Five of the 10 were also found guilty of making and receiving 鈥渃ompensation payments鈥� under which, the CMA said, 鈥渢he designated 鈥榣osers鈥� of the contracts were set to be compensated by the winner鈥�.

Michael Cantillon, who stepped down as chairman of the business in July 2020 after it was bought by Morrisroe, admitted that he raised nine invoices totalling 拢175,000 to be paid by another demolition firm, Scudder.

The invoices related to two jobs in 2014 where Scudder, which has since been discontinued by its parent Careys, made payments to Cantillon in return for the firm making cover bids. A third job, a scheme for the Metropolitan Police in Hendon, in which Scudder agreed to pay Cantillon 拢20,000 for making a cover bid, was, in fact, never actually paid.

Michael Cantillon, whose ban for seven years and six months began earlier this month, admitted: 鈥淚n order to facilitate the payments of compensation from Scudder, I prepared a series of monthly invoices for fictional logistical support services in relation to a Selfridges contract under the authority of a separate company [name redacted].

鈥淚 was the sole shareholder and director of [name redacted] at the time. I used [name redacted] to receive these compensation payments, as I viewed them as money owed to my family, as distinct from the Cantillon company, which I knew was soon to be sold. [Name redacted] raised nine invoices for an overall total of 拢175,000 (excluding VAT).鈥�

Michael Cantillon also admitted he was involved in seven cases of cover pricing, adding: 鈥淚 took a central role in either individually negotiating the cover bid arrangements with the other party/parties involved or in authorising Cantillon employees to undertake such negotiations. In those cases where I delegated the negotiations, Cantillon employees acted under my supervision and at my direction.鈥�

Darsey, whose ban for five years and 10 months began in February, was involved in three cases of compensation payments including one amount of 拢500,000 under which Erith agreed to be paid by McGee for 鈥渢aking a back seat鈥� on bidding the Shell 黑洞社区 contract over summer 2013 that was eventually won by McGee for 拢21m.

The compensation payment 鈥渋nvolved Erith providing a cover bid for McGee. I [Darsey] was contacted by [name redacted] in relation to this tender. He told me that he was desperate for the job and that he would make payment to Erith in consideration for Erith taking a 鈥榖ack seat鈥�. I agreed to this proposal on Erith鈥檚 behalf, including agreement of a compensation payment of 拢500,000 (excluding VAT) and directed my staff to not compete for the contract.

鈥淪ubsequently, Erith issued a series of purported invoices to McGee, ostensibly for supply of 鈥榬eusable steel鈥�. Although, during my interview with the CMA, I was unable to independently recall the agreed and invoiced amount, I admit these payments were received from McGee solely in compensation for the cover price that Erith submitted in the tender process relating to the Shell 黑洞社区, Southbank. I further admit that these invoices were issued by Erith in respect of fictional services and goods that were not in fact ever supplied by Erith to McGee, for the purpose of ensuring that these compensation payments would not 鈥榮tand out鈥� in Erith鈥檚 books and records.鈥�

Cluskey, whose ban for four years and six months starts next week on 1 May, admitted that he was 鈥減ersonally involved in and/or aware of five of the cover bidding agreements鈥� referred to as the 鈥楢dmitted Infringements鈥�.

Cluskey, who has been Cantillon managing director since the end of 2014, added: 鈥淭he Admitted Infringements with which I was involved related to contracts valued at a total of 拢58,996,903.鈥�

On one of the jobs affected by cover pricing, a 拢5.1m scheme won by McGee at 44 Lincoln鈥檚 Inn Fields, which became the site of the Marshall 黑洞社区 for the London School of Economics, Cluskey admitted: 鈥淲hen McGee provided us with feedback on our cover bid, I noted, in an email dated 6 February 2017, that they had inflated our bid by 拢150,000 and expressed a concern that the arrangement would be spotted by the client. I nevertheless permitted CCH [Cantillon] to submit a tender that acted as a cover price for McGee.鈥�

As well as Cantillon, Erith, McGee and Scudder the other firm found guilty of making compensation payments was Brown and Mason. All five were also found guilty of bid-rigging as well along with Keltbray, John F Hunt, DSM, Clifford Devlin and Squibb.

Keltbray, fined 拢16m, and Squibb, hit with a 拢2m penalty, are both appealing the level of their fines. The largest penalty, 拢17.6m, has been handed to Erith.