How to avoid fraud and what to do if you suspect it.
Fraud is a deliberate deception intended to make a financial gain or cause a loss.
How to avoid it
Ways to avoid fraud include:
- always following your procedures and the advice in this guide
- keeping good records
- running a transparent buying process where everyone knows what is happening when
- using a selection stage to exclude fraudsters
- researching how much things usually cost before you start
- having an anti-fraud policy
- doing a fraud risk assessment
Things to watch out for:
- price fixing – where suppliers work together to raise prices or decide who gets the bid
- cover pricing – where suppliers send in some excessively high bids to make other bids seem low or because they do not really want the work, but do not want to look unwilling to do work in the future
- charging for work that is not done or not needed
What to do if you suspect it
If you suspect fraud is being committed report it to the appropriate authorities. You may want to stop your buying process too.