 |
| Credit: Infoprations Analysis, 2018 |
Fraud
and money laundering have
been part of the factors that earn Nigeria one of the most corrupt countries in
the world over the years. It is obvious that private and public sectors are not
immune from fraud and corruption especially in the procurement cycles.
Consequences are often devastating on organisations’ finances and reputation.
Within
the procurement process, illicit rebates, kickbacks and dubious vendor
relationships are the most common fraud activities. In this regard, facility
management companies could not be exonerated because most solutions are executed
by purchasing appropriate materials or goods from manufacturers and suppliers.
Infoprations’
experiences have shown that companies in the FM industry need to be proactive
in detecting and mitigating procurement fraud risk before 2019. In addition to
the impacts of the
quality and financial risks identified previously, companies in the
industry are most likely to lose a significant amount of money to the risk and a
developing bad corporate image that would be difficult to disentangle in the
next few years.
Experience
has shown that procurement department
is more vulnerable to fraud than any other department in the FM companies. Employees
within procurement, operations and administration units in most cases lack
service mentality; they are more interested in serving themselves than serving their
companies. Thus, a high percentage of fraud occurs in these units.
Experience
has equally suggested that fraud begins from the point of getting the Purchase
Order (when clients are requesting for the Supply Solution) to the delivery of goods. Procurement and
Administration officers are either inflating the price or collude with the
supplier/vendor to get their own share, experience suggests.
Factors Increasing the illicit Act
Actors would succeed because of the cartels
and cabals assistance model adoption. Staffs in the three units are more likely
to work together and won’t disclose the wrongdoings within their folks. Infoprations believes that there are
measures companies can take on the micro, the meso and the macro levels to
avert consequences on cost saving and value addition narratives being promoted
to the FM solutions users. The measures could include strong organisational
values or ethics teaching and adherence, and disciplinary actions or policies.
Mapping the Actors
From the insights, it is essential that
companies employ Strategic Fraud Map
for the detection of the main and minor actors. Activities of the procurement
officer, administration officer, drivers, technicians and head of the
procurement department would be more understood through the map. While drawing
the map, the existence of cyclic and smooth relationships among participants
must be revealed. Cyclic relationship would occur when one or two participants
are not comfortable with the activities within the fraud process or being
sidelined in the whole game. On the other hand, smooth relationship will exist
when participants are deriving mutual benefits. These participants need to be
separated or retrenched from the department.
Comments
Post a Comment