Reducing fraud and theft on construction projects
The types of theft in construction
"Theft and fraud take many guises in construction. It is often difficult to control as we depend on many people, subcontractors and suppliers."
Theft and fraud take many guises in construction. It is often difficult to control as we depend on many people, subcontractors and suppliers. Project sites are often spread out and unsecured.
Some forms of theft on construction include:
The cost of theft on construction projects
When we have theft we often only consider the direct cost of replacing the item. But the cost is often more than this. The cost may include:
"You need to be ever vigilant and ensure that there are checks in place that will detect when fraud or theft have occurred. "
Preventing fraud and theft on construction projects
What you can do
You need to be ever vigilant and ensure that there are checks in place that will detect when fraud or theft have occurred. Not only will this be a deterrent to potential fraudsters and thieves but it will enable steps to be implemented to prevent more theft.
Doing simple material reconciliations on projects is a simple way of detecting stock losses, but it is also useful as a double check that all work and materials have been invoiced to the client. It also serves to detect excessive wastage.
We have to place some people in trusted positions but it is important to realise that people’s circumstances change and we cannot know what financial stresses they may be experiencing in their lives, or what temptations they are unable to resist. It’s therefore important to ensure that where necessary there are 2 stage checks in place. In addition by knowing your employees and regularly talking to them you may be able to see the warning signs of potential problems.
Staff need to be vigilant and understand how important it is to have checks in place and ensure that these checks and controls are diligently carried out. On project sites where theft is a possibility extra security measures may have to be installed such as cameras, fencing and security guards. High value and high risk items may need to be secured when not in use.
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The opinions expressed in the attached articles are those of the writer. It should be noted that projects are varied and different laws and restrictions apply which depend on the location of the contractor and the project. It's important that the reader uses the supplied information taking cognisance of their particular circumstances. The writer assumes no responsibility or liability for any loss of any kind arising from the reader using the information or advice contained herein.
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