Where corruption is most likely to occur

Understanding the domains where these risks are concentrated allows agencies to strengthen controls, target prevention efforts and help employees recognise vulnerabilities in their everyday work.

Procurement and contract management

Procurement and contract management are consistently assessed as among the highest-risk functions in the public sector for fraud and corruption. High-value spending, competitive tendering processes and close supplier engagement create inherent vulnerabilities to undue influence, process manipulation and misuse of public funds. These vulnerabilities are particularly acute where discretionary decisions and supplier relationships can be leveraged to favour certain outcomes or conceal improper conduct. 

Recruitment, appointments and payroll

Recruitment and appointments are a high-risk domain for corruption because they determine who gains access to public resources, decision making authority and long-term career opportunities. Where recruitment processes are influenced by personal relationships, undeclared conflicts of interest or the misuse of confidential information, both the integrity and capability of the public sector are undermined. Payroll processes can be exploited where employees with access to human resources or payroll systems create fictitious employees, keep former employees’ records active, or manipulate pay rates, allowances or bank account details without authorisation. 

Secondary employment

Secondary employment (also called outside employment or additional work) creates a corruption risk where private interests intersect with official duties, increasing the likelihood of misuse of public assets, compromised impartiality and conflicts of interest. Even occasional or unpaid work can give rise to real or perceived conflicts of interest if it is not properly declared and appropriately managed.

Financial delegations and asset management

Financial delegations and asset management functions present corruption risks where employees misuse delegated authority over public money or assets for private gain. Where oversight is limited or controls rely on individual judgement, corrupt practices may become normalised and difficult to detect.

Grants and funding allocation

Grants and funding programmes present significant corruption risks where employees or decision makers misuse their authority to favour particular applicants, accept improper influence or enable the misuse of public funds. Corruption risks arise where judgement-based decisions lack transparency, personal or external interests influence outcomes, or post-funding oversight is weak, allowing improper conduct to go undetected. 

Regulatory decisions and licensing

Regulatory, licensing and enforcement roles carry significant authority and discretion. Officers exercise delegated authority that directly affect the legal rights, commercial operations and economic outcomes of businesses and individuals. Corruption risks arise where discretion over approvals, permit conditions, compliance assessments or enforcement responses is misused to solicit or accept improper benefits, tolerate non-compliance or provide unfair advantage to regulated parties. This operational area can be vulnerable to bribery, facilitation payments, conflicts of interest and selective enforcement.

Insider threats and misuse of position

Insider threats arise when employees misuse the access, authority or information their role provides to benefit themselves or others or to cause harm. Insider threats can be difficult to detect, particularly when the conduct occurs within normal work patterns and is perpetrated by trusted employees with legitimate access to systems, data and processes. Insider threat risks exist in every agency, regardless of size or function.

External influence and third-party risks

External actors, including lobbyists, contractors, suppliers, former employees and organised criminal networks, can seek to improperly influence agency decisions, exploit third-party relationships or use agency processes to advance private interests. These risks can be more difficult to detect than internal misconduct because the conduct may appear to follow normal business processes and the primary actor operates outside the agency's direct oversight.

More information

• Check out our range of guidance to see where to start your counter fraud journey
• Assess your organisation’s fraud exposure and weaknesses to inform an effective fraud prevention programme
• Explore controls that organisations can use to help prevent fraud and corruption from happening in the first place
• Learn the red flags of mandate fraud, like grooming or manipulation, urgent change requests and emails from unknown senders
• Corruption takes hold gradually, often through small compromises, unchecked conflicts and relationships that blur professional boundaries – prevention is the most effective response