Red Flags Listed by Project Cycle

Click on a red flag listed in the left column to learn about the red flag and match it to a potential scheme or schemes. Click on a scheme in the right column to see a description of the scheme, a complete list of the red flags for that scheme and suggested follow up steps to see if the scheme is in fact present.

RED FLAGS

RELATED SCHEMES

Procurement Planning Stage

Manipulation of Procurement Thresholds

Unjustified Sole Source Awards, Corruption

Purchase of Unnecessary or Inappropriate Items

Corruption

Prequalification and Short Listing

Improper Evaluation Criteria or Procedures

Manipulation of Bids, Excluding Qualified Bidders, Corruption

Unreasonable Prequalification Requirements

Excluding Qualified Bidders, Corruption

Bidding Documents

Vague, Ambiguous or Incomplete Contract Specs

Unbalanced Bidding, Corruption

Contract Specifications Too Narrow or Too Broad

Rigged Specifications, Excluding Qualified Bidders, Corruption

Failure to Make Bidding Documents Available 

Excluding Qualified Bidders, Corruption

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Short or Inadequate Notice to Bidders

Excluding Qualified Bidders, Corruption

Bidding

Complaints from Losing or Excluded Bidders

Corruption, Bid Rigging, Collusive Bidding

Unusual Bidding Patterns

Collusive Bidding

Physical Similarities in Bids

Collusive Bidding

Bidder Not in Directories or on Internet

Hidden Interests, Collusive Bidding

Too Many Contract Awards to One Company

Corruption, Collusive Bidding

Qualified Companies Fail to Bid

Excluding Qualified Bidders, Collusive Bidding, Corruption

Rotation of Winning Bidders

Collusive Bidding

Unreasonably High Line Item Bids

Collusive Bidding, Unbalanced Bidding

Unreasonably Low Line Item Bids

Unbalanced Bidding, Corruption

Questionable Agent, Consultant or Subcontractor

Corruption

Bid Opening

Non-Transparent Bid-Opening Procedures

Manipulation of Bids, Excluding Qualified Bidders, Corruption

Bid Evaluation

Award to Other Than the Lowest Qualified Bidder

Manipulation of Bids, Corruption

Poorly Supported Disqualifications

Excluding Qualified Bidders, Corruption

Pressure to Select Certain Contractor, Sub or Agent

Corruption

Winning Bid Very Close to Cost Estimates

Unbalanced Bidding, Corruption

Contract Awards

Contract Awards Just Under Procurement Thresholds

Split Purchases, Unjustified Sole Source Awards, Corruption

Long Delays in Contract Negotiations or Awards

Manipulation of Bids, Corruption

Contract Implementation

Complaints re Poor Quality Goods, etc. 

Product Substitution, Failure to Meet Contract Specs, Corruption

Acceptance of Poor Quality Goods, etc.

Corruption

Delivery of Poor Quality Goods, etc. 

Failure to Meet Contract Specs, Product Substitution

Contract Changes

Questionable Change Orders

Change Order Abuse, Corruption

Payment

Questionable Invoices

False, Inflated or Duplicate Invoices, Fictitious Contractor, Corruption

Payment of Unjustified High Prices

False, Inflated or Duplicate Invoices, Failure to Meet Contract Specs, Corruption

Incomplete, Questionable Payment Documentation

False, Inflated or Duplicate Invoices, Failure to Meet Contract Specs, Product Substitution, False Statements and Claims

Also See:

The “Visible Red Flags” of Implementation Fraud

How to Conduct Automated “Proactive” Tests for Red Flags of Fraud