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Fraud and corruption risks in Metal and Mining sector - EY - India

Fraud and corruption risks in Metal and Mining sector

EY Fraud Investigation & Dispute Services perspective

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Metals and mining players are reactivating capital projects and exploration activity, in the face of a recovery in metal prices. However, this is being conducted in a less controlled environment following cost reductions stemming from the global financial slowdown. Such circumstances heighten fraud risk.

Often, in the quest for expanded production and increased returns, projects are conducted in countries more prone to corruption, thereby posing the corruption risks.

This dynamic environment provides a complex challenge around monitoring exposure to fraud and corruption, especially for those most responsible for an organization’s governance — the Board of Directors.

Fraud and disputes: What are the risks and challenges in the metals and mining sector

The key drivers compounded with the challenging business environment have resulted in the generation of several risks which have become endemic to the industry. Some of the key fraud risks confronting the industry are:

  • Procurement
  • Scrap and metal accounting
  • Regulatory compliance
  • Vulnerability to bribery and corruption
  • Hedging and forwards trading
  • Logistics management

How can we help?

At EY, FIDS is well-positioned to support clients in addressing various risks:

Download our brochure for an in-depth analysis of risk and fraud and how we can help overcome them.

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