As long as there's a law and money things can be manipulated.

While my experience isn't in finding employees I have a story along the same lines. One of my employer's customers is a public institutions where the managers are very pleased with our way of handling their business. In order to keep us and avoid dealing with bigger, less flexible companies they do some questionable things. Contracts above certain sums are subject to public bidding, so just break them into parts and avoid the bidding. And of course, their legal department offered to help if things are shook up so that all outside contracts must be put up for bidding. They said "we'll agree on the price, write your bid for you and make sure it's the only one that meets our standards".

Not a bad decision when the only competing bids are likely to come from a multinational company (you pay us and do the work yourself) and another local talent (you pay me, I drink the money and leave the job undone).