Issue

A federally funded transportation company sought assistance in performing a fraud risk assessment of the company’s procurement processes. The company was set to receive an influx of additional funding from the government, which would lead to rapid growth and increased spending. The evolving risk environment would also challenge established processes and make the company more susceptible to fraud, waste, and abuse.

Solution

StoneTurn collaborated with the company to establish a fraud risk assessment framework that aligned with the company’s prior assessments, current internal methodologies, and external leading practices. StoneTurn developed a series of procurement-focused fraud risk scenarios and conducted facilitated workshops with key stakeholders to evaluate inherent risk levels associated with each scenario. StoneTurn also evaluated internal policies and procedures to identify potential mitigating controls and determine residual risk associated with each scenario.

Results

StoneTurn’s fraud risk assessment identified critical gaps in fraud prevention activities within processes and known practices. These findings were incorporated into a comprehensive report for company leadership that included all identified procurement fraud schemes and scenarios, a heatmap of top risks, and recommendations to improve the internal control environment, further mitigate procurement fraud risks, and improve the overall risk environment.