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Know how the Biggest Government E-tender Scam was carried out

IamCheated.com Research Team | April 19, 2019  6:37:pm

Know how the Biggest Government E-tender Scam was carried out

Online frauds are rising day by day and people are coming up with ingenious ways to dupe people and make quick cash. Some fraudulent practices like credit card hacking or phishing scams are quite regular and are often heard of. But have you ever heard of a scam carried out on a government e-tender site?

Well, you are guessing it right. These scams cannot be carried out by local scammers. It is evidently the task of some insider who had access to the inner networks. In this blog we will discuss how a gang of private bidders rigged the government e-tender portal with the help of government officers and carried out this scam.

See Also: Financial Scams In India

Government e-tender

The state government provides tenders through the eProcurement system. This facility reduces the tendering cycle time and reduces operational costs and increases transparency. All sensitive documents in the e-tendering site are encrypted and stored in the server using the Public Key Infrastructure (PKI) technology. Both the Technical and Financial Documents are encrypted and stored. Even the system administrator cannot view the bid documents before the bid opening.

How the scam was carried out?

This is one of the biggest online scams that was conducted to favour private bidders to easily grab government contacts. The scam involves multiple parties and software companies who are charged under IPC section 420 (the Information Technology Act and Prevention of Corruption Act).

The manipulation was done by copying the original bids of the rival companies onto the DEMO department folders after the last date of submission. The copied dummy tenders were then opened by the DEMO department by using the tender opening authority’s digital signature certificate to reveal the bid value of the rival companies. The same digital signature certificate was mapped to fill in lower bid values and push out rival bidders.

See Also: A Cunning Scam By Fraudsters

Entities involved in the scam

The Economic Offences Wing (EWO) has arrested Nand Kumar Brahme in connection with the e-tender scam. He is accused of manipulating the bids that were to be issued by the government. He is the only government official to be arrested as a major suspect.

Some official of the Bhopal based OSMO IT solutions has also been arrested which issued ‘signature certificate’ for e-tenders.

The racket also involved seven construction companies namely, GVPR limited, MS Max Maintaina, The Hume Pipe Limited and JMC Limited, Sorathia Velji Limited, Ms Madhav Infra Projects and Ram Kumar Narwani Limited. The companies allegedly hacked the MP e-tender portal to provide lowest quotes and bag tenders worth Rs. 3000 crore.

Latest updates on the scam

Brahme, who was an official of state electric department corporation in MP, is taken in police custody after he was produced in the local court. The EWO is now targeting the bureaucrats including some IAS officers, who allegedly connived with the private firms and private bidders to rig the encrypted bids. In an FIR, the EWO hints at the role of state officers stating that the unauthorized use of “ the digital signature of the tender opening authority” was a part of criminal conspiracy due to which the e-tender scam took place since 2014.

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