When numerous well-known suppliers and original equipment manufacturers engage in deceptive practices, including falsifying product data or neglecting to report known defects, the fundamental question that arises is whether any claim from any company can be trusted. This paper sheds light on the importance of tackling supply chain fraud more rigorously. This paper discusses the current state of supply chain complexity and customer practices and then highlights the prevalence of fraud and its impact on all consumers. Examples of renowned companies that have either publicly acknowledged fraudulent practices or were caught in some level of deception in their supply of products are provided. Examining the different instances of fraud enabled us to identify cost reduction as a conjoint recurring cause, which formed the baseline to develop and suggest guidelines for fraud detection and risk mitigation. INDEX TERMS Cost reduction, fraud, organizational wrongdoing, quality, reliability, supply chain. I. INTRODUCTION In September 2015, the U.S. Environmental Protection Agency (EPA) announced that cars sold by Volkswagen in the United States emitted higher than allowed levels of environmentally harmful nitrogen oxide compounds [1]. Volkswagen, the world's second largest automaker at the time, denied the accusations for more than a year until confronted with evidence of its ''defeat software''. The software was able to detect when the vehicle was being tested rather than being driven, at which point it switched to ''dyno calibration mode'' to register emissions below the EPA compliance limit [2]. When tested without the defeat software activated, vehicles released up to 40 times more nitrogen oxide than the allowed limit [3]. Volkswagen admitted to the fraudulent activities, and has paid USD 2.8 billion in criminal fines and USD 1.5 billion to settle civil, environmental, customs, and financial violations 1 [7]. The Volkswagen example, however, is just one of many. Clear, factual, and complete disclosure of product data is expected from every participant in a supply chain-from The associate editor coordinating the review of this manuscript and approving it for publication was Bora Onat. 1 Numerous companies, including Audi [4], Porsche [5], Peugeot [6], and more, have been subsequently caught implementing such ''cheating software'' in their cars to trick environmental regulation tests. materials, parts, and systems suppliers, 2 to manufacturers, assembly companies, and distributors [8]. For safety-critical components (such as those purchased for the commercial nuclear industry), such disclosure is often a requirement. 3 Unfortunately, fraudulent practices from well-established and previously respectable companies appear to be on the rise over the past 10 years, and it is increasingly difficult, if not impossible, for customers nowadays to trust their suppliers the way they might have in the past. Per U.S. common law, the definition of fraud requires that a material or false statement be made with the intent to deceive anoth...
