The Office of Fair Trading (OFT) is to offer whistle-blowers up to £100,000 to inform on illegal cartels.

It is the first time the OFT has offered money for information and means Britain ranks with South Korea in giving financial incentives for evidence.

The OFT said today that the scheme to give rewards for information on price-fixing would run for 18 months before it is reviewed.

The £100,000 reward will be paid to individuals only where information is accurate, verifiable and proves to be useful in the OFT’s anti-cartel enforcement work.

The OFT initiative follows revelations that Her Majesty's Revenue and Customs paid an informant £100,000 for bank details of wealthy Britons with accounts in Liechtenstein, the secretive haven at the centre of a tax evasion scandal.

Cartels are prohibited under the Competition Act and any business found to be a member of one could be fined up to ten per cent of its turnover.

The Enterprise Act makes it a criminal offence for individuals to dishonestly take part in cartels and anyone convicted of the offence could receive a maximum of five years imprisonment and/or an unlimited fine.

Simon Williams, senior director of cartels and criminal enforcement at the OFT, said: "Cartels are very damaging both to businesses and consumers and they are usually conducted in secret, making them hard to detect.

"Cartels are not the preserve of big business. For example, if a local authority needs to find a contractor to refurbish its schools, it is unacceptable for local contractors to seek to rig the tender process by colluding on price."

"We believe that it is in the public interest to offer financial incentives in the hope that it will encourage more people who have good information about the existence of hardcore cartel activity to come forward and, in exceptional circumstances, these incentives may be as high as £100,000."

Times Recommends

• Minister in talks with Saudis to protect creditors
• Premier Inn hits back in £29-a-room row
• Bankers hit back at 'populist' bonus supertax