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Allegations of corruption have resulted in an investigation of Brazil's national 'oil' company prior to an incumbent Brazilian president disputing their re-election. The investigation has examined allegations that several directors of the 'state'-owned company received bribes from construction companies and that the funds were used to support the parties of the governing coalition. Using a case study, this paper presents the approach adopted by the Brazilian Federal Police to determine if collusion had occurred. The bidding patterns of construction firms in 22 infrastructure projects suggested to the police that collusion occurred. Considering these circumstances, 561 bids for 77 projects were examined. Investigators obtained evidence that indicates that a collusive behaviour regarding procurement at specific construction firms (the League of 16) had taken place. The conclusions of the research provide insights into the intendment of the League of 16's bidding patterns with an example of the 'real' cost of cartelisation that was experienced in an infrastructure project.

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In this article, we present findings from the Brazilian Federal Police’s ongoing investigation referred to as ‘Operation Car Wash’, which led to an accusation of collusive bidding being presented to a cartel that comprised 16 construction contractors. While plea bargains from several contractors within the cartel have materialized, additional evidence needs to be provided by the investigations officials to ensure the adequate application of justice. In this article, we provide scientific evidence that can be used by the Brazilian criminal courts to demonstrate the presence of collusive bidding. The contributions of this article are two-fold: (i) a robust and reliable econometric model to prove the presence of collusive bidding is implemented, which meets the basic criteria defined by the judicial system for scientific evidence; and (ii) the negative economic impact of collusive bid rigging is quantified, which was much higher than the percentage admitted by those involved in their leniency agreements.

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