“Procurement Fraud in the Construction Industry- the Nigerian Public Private Partnership (PPP) Dilemma”

Abstract

This paper researches the risk of procurement fraud in the construction industry in Nigeria within a Private-Public Partnership (PPP). It analyses the diverse Nigerian culture and environment to assess the impact of the control environment, internal controls, institutions and risk of procurement fraud. 35 questions were posed to 193 respondents through a questionnaire. The respondents for this research were professionals from the construction industry in Nigeria focusing on site personnel, engineers, consultants etc. This is step away from the typical research within this area that had focused on accountants, compliance officers, auditors and others that may have been exposed to the anti-fraud or anti-corruption education. The analysis revealed that risk of procurement fraud is mainly due to the political and cultural environment, and the tone at the top in the PPP procurement process. This can be explained as pressure on management by political God-fathers and nepotism that exists in the Nigerian society. To address this issues it is recommended that, PPP procurement process be automated, regulations be reviewed, punishment for corruption and bribery increased, whistleblowing awareness and administrative bottle-necks be eliminated.

Keywords: Procurement Fraud, Corruption, Construction Industry, Nigeria.