Bribery and fraud risks in the construction sector

9th September 2021

We look at potential bribery and fraud risks in the construction sector and the importance of contractors having robust systems in place to ensure individuals have the relevant skills.

Last month, the Construction Industry Training Board (CITB) confirmed investigations into nine construction training centres based on concerns that individuals have received, from the training centres, Construction Skills Certification Scheme (CSCS) cards where there is no evidence that they have in fact passed the required examinations, or where there is evidence that third parties have provided assistance to ensure a pass grade.

In addition, CITB has explained it has a further concern that gangmasters are offering bribes to the test centres to ensure individuals receive a CSCS card. CITB fraud manager, Ian Sidney, said:

We’re aware of good centres being approached by these facilitators, offering them carrier bags full of money to bring unlimited candidates to their centres. At a time when businesses are struggling, it’s almost too good to refuse but what they’re being offered is not what they are going to eventually get.

As well as potential criminal liability for the training centres, this also poses potential risks for those who go on to employ individuals who possess fraudulently obtained CSCS cards.

At a time when the industry is dealing with a shortage of workers as a result of the fallout from Brexit, and cuts to compliance budgets due to financial difficulties caused by covid pandemic, contractors and employers should be alive to how these difficulties can be exploited by criminals.

Action to take to limit bribery and fraud risks

Responsible contractors are required to have a system in place to ensure that individuals working on their projects have the necessary skills and knowledge, as part of their compliance programmes. These systems will be of particular importance in the event of an incident on site where regulators, including the HSE, may be called to investigate. The outcome of any investigation could turn on the competency of workers and the strength of quality assurance mechanisms in place, and an inability to show robust compliance systems can have significant consequences for a business.

Similarly, employers should be mindful of their own health and safety obligations, as well as the need to have in place adequate procedures in place to prevent bribery throughout their supply chains.

The investigations launched by CITB serve as a timely reminder for businesses to ensure their existing compliance policies and procedures are fit for purpose.

This article has been co-written by Mark Jones and Dominic Jones. Please do contact either author if you have questions regarding bribery and fraud risks in the construction sector.


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