The Construction Audit & Cost Control Institute Recommends Actions to Take to Reduce the Impact of Fraud on Projects
Dallas, TX (PRWEB) July 30, 2013 -- Courtenay Thompson, a recognized authority on construction fraud and corruption training and presenter of our seminar Construction Fraud: Detection, Prevention & Response, October 7-8 in Dallas, recommends eight actions to take to reduce the impact of construction fraud on projects.
1. Know the risks of fraud in construction. The very nature of construction projects makes them vulnerable to fraud. Construction-related fraud includes intentional overbilling, shorting the job, product substitution, price fixing and bid rigging, kickbacks and corruption. Construction fraud can relate to cost of the work or to the work itself. Owners and their representatives need to know the specific exposures to construction-related fraud for their projects.
2. Commit to keeping construction-related fraud in check. Owners can define their expectations related to dishonest and fraudulent activity. These expectations can be defined in codes and policies. As important as these codes are, management reaction to suspected wrongdoing is even more important. Management reaction can discourage or encourage potential perpetrators. Employees and contractors learn from how others are handled.
3. Communicate your expectations to contractors, subcontractors and suppliers. Communicate expectations by requiring contractors, subcontractors and suppliers to abide by codes of ethics and gift policies. Require disclosure of suspected wrongdoing. Post hotline numbers at jobsites and include them in vendor information. Include right to audit provisions in all contracts. For larger contractors discuss their policies and procedures related to fraud.
4. Eliminate erosion of oversight associated with entertainment. Recognize the role entertainment plays in your culture. Excessive and inappropriate entertainment has often been present when there is overbilling or non-performance. Eliminate or minimize entertainment to avoid erosion of oversight.
5. Avoid over reliance on contractors to protect owner interests. Problems creep in. Owner commitment to the work detail and billings reduces opportunity for construction fraud to occur and go undetected.
6. Build prevention into contracting and management. Know your contractors and subcontractors. Determine their civil and criminal litigation history, as well as your organization’s experience with them on prior projects. Forbid executives, board members and elected officials from interfering with the procurement process. Require management involvement in detail.
7. Build detection into management and audit practices. Management monitoring, testing, and review of the work and billings are essential. Resist the temptation to over rely on the contractor to protect owner interests. Make auditing of the contractors’ books and records a control priority. Some fraud is best detected in the records of third parties.
8. Develop a professional response for suspected wrongdoing. Suspected wrongdoing, allegations or suspicions merit a planned reasoned response by someone independent of the area, with the authority, skills and knowledge to conduct a complete investigation. Professional investigation can yield evidence to support appropriate action.
Construction Fraud: Detection, Prevention & Response
October 7 – 8, 2013 in Dallas, Texas
This construction fraud seminar provides solutions. Protection against construction fraud is more than assuring accurate billing. Fraud may involve trusted insiders in collusion with contractors, or it may be the contractors themselves, as in recent bid rigging cases. Fraud can impact projects from start to finish. Corruption, kickbacks, conflicts of interest, performance issues, and predatory billing practices are common forms of construction fraud. Political considerations and relationships combine with the very nature of construction projects to make fraud difficult to detect and even harder to handle. This course raises awareness and provides practical tools for prevention, detection and response. 16 CPE Hours
Regular Registration Fee: $1,195
About Courtenay Thompson & Associates
Courtenay Thompson & Associates (http://www.ctassoc.com) provides fraud-related education and advisory services. Current topics include fraud detection, prevention and investigation, fraud awareness for managers, construction fraud, and purchasing, contract and procurement fraud. Courses are designed to address situations and issues actually encountered. Seminars are led by instructors with extensive work experience in the topic being taught. Experience and solid course design combine with training expertise to assure a high quality learning experience.
About The Construction Audit and Cost Control Institute
The Construction Audit and Cost Control Institute (CAACCI) of Dallas, Texas was created in 2008 to provide public offering seminars in affiliation with Courtenay Thompson & Associates. The CAACCI member's only website was created as a resource to share information for today’s challenges in construction auditing and construction cost control. CAACCI members include project management and construction audit representatives from a wide range of private and public organizations. For more information, visit http://www.caacci.org.
Mr. Courtenay Thompson, Courtenay Thompson & Associates, http://www.ctassoc.com, (214) 361-8346, [email protected]
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