Look out for red flags! What can fraud look like in the Defence Team?

March 25, 2024 - Defence Stories

The Defence Team is a complex organization and is responsible for one of the largest public budgets in Canada—a very tempting target for fraudsters. Always be on the lookout for red flags whenever you are dealing with people and businesses external to the Defence Team.

Fraud attempts can come in many forms, targeting different areas of the Defence Team. Know the red flags, stay vigilant, and be ready to report it (accessible only on the National Defence network) if “something doesn’t look right!”

Below are three types of globally common fraud schemes to watch out for:

Identity fraud is when someone produces false information about themselves, or their qualifications, to gain an unfair advantage in a process; for example, someone falsifying documents to be hired in a position with standardized professional qualifications.

Red Flags:

• A new employee not performing at a level consistent with their formal training;
• A “professional” who does not understand routine tasks in their profession; or
• Constantly needing to review and correct the work of someone who has allegedly excelled in this work before.

Product substitution is when items purchased by the Defence Team are knowingly replaced with sub-standard, used, outdated, or counterfeit products. Not only is this a breach of contract, but it could also put Defence Team members in danger, depending on the product’s use.

Red Flags:

• “New” products appear to be previously used.
• You’re experiencing higher than usual repair costs.
• Products need to be replaced well ahead of their expected shelf life.

Collusion is when normally competing businesses agree to work together to manipulate a process, such as Request for Proposals (RFP), to gain an unfair financial advantage. The Defence Team relies on a fair and competitive process to ensure fair value for our use of public funds.

Red Flags:

• Two or more proposals from competing firms contain similar typos, mathematical errors, or the exact same formatting.
• Proposals from competing firms arrive in the same envelope or from the same email address.