AI IN PROCUREMENT
Procurement fraud has been on the radar of industries since the mid-90s following the publishing of the Association of Certified Fraud Examiners( ACFE) procurement and billing fraud annual report. The data showed an alarming result. Procurement and billing is one of the largest categories of occupational fraud loss. There has been a consistent rise in systemic and organised exploits, not just opportunistic and isolated bad actors.
Greg Henderson is Senior Director of Risk, Fraud and Compliance Solutions at SAS, the data and AI software provider, where he leads global strategy across the health, public sector, energy and manufacturing verticals.
Reflecting on what acts are considered‘ procurement fraud’, he explains:“ The legal definition of fraud implies criminal intent; this is often a judgment call on what someone was thinking, which can be challenging to prove. That’ s why we prefer the term‘ payment integrity’ over‘ fraud’.
“ The goal of payment integrity is to ensure that payments are made correctly rather than attempting to establish criminal intent. Payment integrity encompasses not only fraud detection but also identifying waste, abuse and errors. The real goal here is to detect and prevent improper payments, not merely detect fraud.”
Seeing a clear rise in organised and systemic exploits, Greg attributes this to a rise in many organisations using a smaller pool of ERM systems.
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