YouGov: 97% of UK construction firms admit money laundering risk
Almost all middle market UK construction companies feel at risk of breaching anti-money laundering and anti-bribery legislation, a new report has revealed.
The survey by YouGov, on behalf of consulting firm RSM, found that 97% of the 300-plus businesses studied admitted to feeling at risk.
Further, 47% said they have suffered, unwittingly or otherwise, in incidents that are outside of the law.
- Construction firms lose £1.8 billion in invoice fraud
- KPMG appoints 20-year veteran Jonathan White as head of UK construction practice
- Read the latest issue of Construction Global here
However, despite the almost unanimous recognition of the money laundering risk, 62% of respondents felt that non-financial reporting - the mechanism through which risk is minimised - is excessive or demanding – diverting major resources and hindering company operations.
Kelly Boorman, Head of Construction at RSM, said: “Our research highlights that anti-money laundering and anti-bribery legislation presents a real risk to the construction sector. Not only the reputational and operational disruption if there is a breach; but also implementing sufficient internal procedures to mitigate risk.
“It also suggests a worrying ‘cake and eat it’ mind-set within middle market business. On the one hand businesses recognise the major risks they face, yet on the other hand remain reluctant to fully engage in a process that minimises the risk and associated liabilities.”
The report sets out how, through highlighting the key areas of non-financial reporting (NFE), organisations can set about addressing the governance.
Money laundering is just one type of fraud impacting the construction industry. A study by Grant Thornton in 2013 cited estimates which placed the cost of fraud at up to 10% of revenue, or an average of £10,000 per company.
- Heathrow Airport's third runway: Construction industry reacts to landmark MP voteEPC
- Opinion: What recruitment options do UK construction companies have post-Brexit?Digital Construction
- Drones can save UK construction industry £3.5bn by 2030 – PwCTechnology & AI
- KPMG appoints 20-year veteran Jonathan White as head of UK construction practiceEPC