Fraud Prevention and Detection

FRAUD PREVENTION AND DETECTION

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Product Substitution

This refers to goods or services supplied under an existing contract that

do not conform to the contract specications. Some contractors have been

accused of using poor- quality building material, such as cement. This

scheme often surfaces when bridges, highway overpasses, and tunnels fail.

Product Substitution—Case Example

In the city of Montreal, Canada, road construction contractors have

been accused of using inferior products in the construction of the

various highway overpasses that have been built over the years. A

number of overpasses have failed and cement and steel rods that

were used have caused the structures to fail and make them unsafe

for future use.

Progress Payment Fraud

The contractor ...