Fraud is costing Peterborough companies £10 million a year, claims report

Fraud is costing companies in Peterborough an estimated £10 million a year, according to a new report.

Monday, 9th May 2016, 2:05 pm
Updated Monday, 9th May 2016, 3:07 pm
Phillip Letts, chief executive of the blur Group.

Spending that is not properly managed or detailed in contracts is most at risk from rogue spending and fraudsters who rig bidding processes.

The alarm has been sounded by procurement and efficiency experts London-based blur Group.

The firm says the estimated £10 million loss has been calculated from data used by the Government’s Annual Fraud Indicator.

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In addition to the £10 million lost by business a further £1.7 million is lost by the public sector.

Phillip Letts, chief executive of the blur Group, said: “The figures are shocking.

“It is recognised that some 20 per cent of all spend by organisations is unmanaged and often un-contracted, and so at risk to procurement fraud, the second most frequently reported form of economic crime.

“The impact of practices such as deliberate bid rigging and rogue spending includes increased and unnecessary costs, reduced profits and ultimately higher prices and bills passed on to consumers and taxpayers.

“As well as private sector companies wasting millions of pounds of their own potential profit and operating under a tighter financial burden, a major aspect of procurement fraud falls within the public sector which means taxpayers’ money is being wasted too.

“This part of an organisation’s spend is largely unmanaged, meaning many are not even aware that the issue is so prevalent.

“What I do find encouraging is that the problem is starting to be recognised and there is huge potential for organisations to do something about it.

“Some companies and councils are now beginning to tackle the issue, looking in detail at the cost and impact it has, improving processes to become more efficient and moving quickly to address inefficiencies to prevent failures to get the best price and mitigate the risks from rogue spenders and deliberate fraud.”