New standard can help organisations prevent procurement fraud

A recent survey from CIPS showed that 9.3% of businesses had suffered at least one incident of procurement fraud in the last year. Alarmingly, the National Fraud Authority survey of 2012 estimated around £2.4bn losses to the UK public sector in 2011 – almost 1 per cent of the government’s entire procurement budget.

With such huge implications for cost and reputation, businesses of all types and sizes are now under scrutiny, and this is not just a matter for the private sector. As the National Fraud Authority’s survey showed, the public and third sectors also need to be vigilant. Research showed that a standard offering guidance on specific measures to help address multiple procurement fraud risks, was needed.

Andrew Coulcher, Director of Business Solutions at CIPS said: “Unlike fraud and bribery, procurement fraud requires different controls which are very specific. With that in mind we wanted to create an overarching piece of guidance that would help organizations from a very top level.”

BS 10501 will benefit legal, compliance, procurement and supply chain professionals in the banking, insurance, pharmaceutical, retail, energy, defence and security industries as well as universities and the NHS.

Anne Hayes, Head of Market Development for Governance and Risk at BSI said: “Being aware of what is happening in a business’s supply chain is a vital way to ensure that it is protected at all times from issues such as procurement fraud. A standard such as BS 10501 can equip businesses with the best tools to protect themselves and their reputations. Having guidance on managing these risks could be invaluable.”