Hong Kong’s competition watchdog has cracked down on a new syndicate suspected of bid-rigging in tenders for building maintenance projects across 17 estates and buildings, with the value of contracts hitting HK$700 million (US$89.7 million).

The two-day operation is the first major enforcement action led by the Competition Commission following the deadly Tai Po blaze last November, which renewed scrutiny over the years-long malpractice of the city’s construction sector.

Codenamed “Hunter”, the watchdog’s raid on Wednesday and Thursday targeted 27 premises including the offices of 14 companies comprising project contractors and a consultancy firm, as well as the residences of the individuals involved.

The commission said on Thursday that its investigation revealed that the mastermind of the syndicate was a project contractor who allegedly coordinated with a consultancy firm and other contractors to manipulate tender results through various deceptive means.

“During the tendering of some of the targeted renovation projects, the mastermind of the syndicate managed to obtain the estimation of the project cost, which was supposed to be confidential, from the consultancy firm,” the statement read.

The syndicate allegedly arranged for some contractors to submit bids with higher prices, commonly referred to as “pig quotes”, to create a false impression of competition while allowing the mastermind to win the tender.

“In other tenders, the contractors took turns to act as ‘cover bidders’ to support the designated winner of the tender,” it added.