The recent convictions arising from procurement activity within the Scottish NHS provide a stark reminder that procurement fraud remains a significant risk across the public sector. In June 2025, four individuals, including NHS officials and supplier representatives, were sentenced following convictions for bribery, corruption and fraud offences connected to telecommunications contracts worth approximately £6 million. Prosecutors described a scheme in which public officials received benefits including cash, holidays and entertainment in exchange for procurement advantages.
The case attracted attention not only because of the value of the contracts involved, but because it demonstrated how trusted individuals were able to exploit procurement systems over an extended period. According to the Crown Office and Procurator Fiscal Service, the offending took place between 2010 and 2017 and involved collusion between public officials and supplier representatives in relation to NHS contracts. Procurement processes intended to secure fair competition and value for money were deliberately undermined, resulting in a significant breach of public trust.
Whilst the offences arose within Scottish NHS bodies and under a different procurement regime – most notably, the Procurement Reform (Scotland) Act 2014, which governs public procurement in Scotland – the risks exposed by the case will be familiar to contracting authorities across England and Wales, and indeed other jurisdictions. The conduct at the heart of the prosecution was not a technical procurement law issue. Rather, it involved challenges that can arise in any public body: unmanaged conflicts of interest, inappropriate supplier relationships, weak oversight and failures to identify warning signs. As such, the case provides a useful opportunity for English and Wales, and beyond, to reflect on their own fraud prevention and governance arrangements.
Procurement fraud is often a relationship risk
When procurement fraud is discussed, the focus often falls on processes. Whether sufficient approvals have been sought and whether the correct documentation is in place. However, many of the most serious cases stem from relationships rather than procedural shortcomings.
The NHS Scotland case centred on inappropriate relationships between supplier representatives and public officials. Procurement rules were in place, but those controls were ultimately circumvented by individuals willing to abuse positions of trust for personal gain. The case is a reminder that effective procurement governance requires authorities to focus not only on compliance but also on the relationships and behaviours that can influence decision-making.
Contracting authorities should therefore ensure that conflicts of interest are actively managed throughout the life of a procurement and subsequent contract. Declarations should not be treated as a one-off administrative exercise. Long-term contractual relationships can create opportunities for new conflicts to emerge and therefore require ongoing scrutiny.
Those relationships can distort procurement in concrete and damaging ways, including through sole-sourcing, inflated pricing, unjustified contract variations and the bypassing of approval processes. Understanding these mechanisms is essential to identifying and responding to warning signs at an early stage.
Gifts, hospitality and conflicts of interest remain critical
A notable feature of the prosecution was the allegation that public officials accepted benefits including cash, holidays and entertainment from supplier representatives. Such arrangements create obvious risks to objectivity and can undermine confidence in procurement outcomes even where no procurement decision can be directly linked to a particular benefit.
Authorities should ensure that they have robust arrangements governing:
- declarations of interests;
- gifts and hospitality registers;
- outside employment and business interests;
- periodic conflict reviews; and
- regular training for procurement and contract management staff.
The most effective controls are those that promote transparency and encourage early disclosure of potential conflicts before they become problematic.
Contract management is a key anti-fraud control
Public bodies often devote considerable attention to running compliant procurement exercises but less attention to contract management once an award has been made. Yet fraud risks frequently arise after contract award when supplier relationships have become established and commercial arrangements begin to evolve.
The NHS Counter Fraud Authority identifies procurement and commissioning fraud, including bribery, collusion and invoice-related fraud, as a significant risk area across the NHS.
For contracting authorities, strong contract management should include:
- regular performance monitoring;
- scrutiny of contract variations and extensions;
- review of spending and payment patterns;
- segregation of duties between ordering, approval and payment functions; and
- targeted audits of higher-risk contracts.
Authorities should also conduct supplier due diligence at the pre-award stage and throughout the life of a contract. This should include checks on related-party relationships and beneficial ownership, which can reveal undisclosed interests that would otherwise remain hidden. The transparency provisions and debarment framework under the Procurement Act 2023 make this discipline increasingly important for English contracting authorities.
Good contract management is not merely a commercial discipline. It is an important safeguard against fraud and corruption.
Culture matters more than policy documents
Most public authorities already have procurement rules, anti-fraud policies and codes of conduct. The challenge is ensuring that those policies are embedded within the organisation.
The NHS Scotland prosecution demonstrates that written procedures alone cannot prevent misconduct where individuals are prepared to ignore them. Organisations that successfully prevent fraud are often those that cultivate a culture of integrity, transparency and challenge.
An effective anti-fraud culture is typically characterised by:
- visible leadership commitment to ethical conduct;
- accessible and trusted whistleblowing arrangements, supported by clear policies that comply with the Public Interest Disclosure Act 1998 and that make staff aware of the legal protections available to them;
- regular fraud awareness training;
- encouragement of constructive challenge; and
- prompt investigation of reported concerns.
In many cases, fraud is detected because an individual notices unusual behaviour and feels confident enough to raise it.
The role of internal audit should also not be overlooked. Contracting authorities are typically required to maintain an internal audit function, and that function is well placed to provide ongoing assurance over procurement and contract management processes, and to identify weaknesses before they are exploited.
Data and assurance should play an increasing role
The growing availability of procurement and expenditure data provides contracting authorities with greater opportunities to identify unusual patterns before significant losses occur. The Public Sector Fraud Authority has continued to emphasise improved fraud risk management and stronger counter-fraud capability across the public sector.
Authorities should use data analytics to identify:
- repeated awards to the same suppliers;
- unusual payment activity;
- duplicate invoices;
- contract splitting designed to avoid approval thresholds; and
- repeated or substantial contract variations.
While technology should complement, rather than replace, professional judgment, it can provide an effective early-warning mechanism that prompts timely human intervention.
Relevance under the Procurement Act 2023
For English contracting authorities, the case reinforces several themes that align closely with the objectives underpinning the Procurement Act 2023. Greater emphasis on transparency, supplier integrity and effective management of conflicts of interest reflects a recognition that public confidence relies not only on compliance with procurement rules but also on the integrity of the people and organisations involved in public procurement.
While the Scottish regime operates independently, several specific provisions of the Act (covering England and Wales) are directly relevant to the risks illustrated by the NHS Scotland case:
- The exclusion and debarment framework in Part 3 and Schedule 6 of the Act includes mandatory exclusion grounds for corruption and bribery offences, meaning that suppliers or individuals with relevant convictions may be excluded from future procurement exercises. This is a direct legislative response to the kind of conduct at issue in the prosecution.
- The transparency notices regime imposes new publication obligations on contracting authorities, increasing public scrutiny of procurement decisions and making it harder for questionable awards to go undetected.
- The Act mandates the formal assessment and active management of conflicts of interest across the entire procurement lifecycle, directly reinforcing the governance obligations discussed in this article.
- The Procurement Review Unit has powers to investigate and report on non-compliance, providing an additional layer of external scrutiny for contracting authorities.
Although the legal framework applicable to the NHS Scotland case differs from that applying in England, the underlying risks are strikingly similar. Unmanaged conflicts, insufficient oversight and complacency in long-standing supplier relationships can arise in any organisation responsible for spending public money.
A note on corporate and organisational liability
Whilst the NHS Scotland prosecution focused on the culpability of individuals, contracting authorities and their legal advisers should also be mindful of the potential for organisational liability in cases involving procurement fraud. The Economic Crime and Corporate Transparency Act 2023 introduced a "failure to prevent fraud" offence, which applies to large organisations and can result in criminal liability where a person associated with an organisation commits a fraud offence for the organisation's benefit and the organisation did not have reasonable fraud prevention procedures in place.
Contracting authorities are not commercial organisations and the offence applies primarily to the private sector, but the case serves as a broader reminder of the importance of having demonstrable, documented fraud prevention frameworks in place – not merely as a matter of good governance, but as a matter of legal risk management for all public sector bodies operating alongside private sector suppliers and intermediaries.
Conclusion
The NHS Scotland prosecution should not be viewed solely as a Scottish procurement story. Rather, it is a public sector procurement story that highlights vulnerabilities present across the UK. For non-Scottish contracting authorities, the case demonstrates that procurement fraud rarely arises because there are no rules. More often, it occurs where relationships go unchallenged, conflicts remain undisclosed, oversight weakens and warning signs are missed. The strongest defence remains a combination of transparency, effective governance, robust contract management and a culture that encourages scrutiny and accountability.
The key lesson from the NHS Scotland case is a deceptively simple one: procurement fraud is seldom the result of a single control failure. It is usually the consequence of several small weaknesses combining over time – unmanaged relationships, undisclosed conflicts, insufficient oversight and a culture that did not encourage challenge. Contracting authorities that remain vigilant across all those dimensions will be best placed to protect public funds and maintain public trust.
How we can help
Trowers & Hamlins has extensive experience advising contracting authorities on procurement governance, anti-fraud frameworks, conflicts of interest policies and contract management arrangements. If you would like to discuss how we can assist your organisation in reviewing or strengthening its procurement and governance protocols, please contact a member of our team.
