Dissect Fraud of Planning and Bidding for Procurement of Goods and Service

Abstract

Procurement of goods and services is one of the biggest contributors to corruption in the public financial sector in Indonesia based on the 2019 Corruption Eradication Corruption (KPK) annual report, the number of cases in procurement was 174 cases with a value of 957,3 billion state losses and a bribe value of 91,5 billion(KPK, 2019). Procurement of goods and services is often identified with is called fraud, both in the planning process, bidding, implementation and even reporting (Artantri et al., 2016). Based on the 2015 semester Corruption Watch (ICW) Index report, corruption in procurement of goods and services is a source of state financial leakage with embezzlement mode with 82 cases, misuse of the budget of 64 cases, abuse of authority of 60 cases, and mark up of 58 cases. (Matthew et al., 2013) stated that procurement is very vulnerable to the risk of fraud and corruption both in the private sector and government by bribery to contracting officials. In the procurement of fraud can be started from procurement officials or vice versa from the provider of procurement of goods and services. Procurement of goods and services is one source of budget leakage.