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Effective solutions to combating fraudulent claims & usage of qualifications

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The fraudulent use of certificates awarded for successful completion of safety training courses as well as other related certificates is on the increase. This is not surprising to many executives within these safety critical industries, however fraud is a difficult problem to solve and requires innovative solutions.

The problem – safety certificate related fraud

In 2021, the CEO of Energy Safety Canada acknowledged that there were potentially thousands of fraudulent safety certificates in use in the industry. Energy Safety Canada, the national health and safety association for the oil and gas industry in Canada, creates national standards of training that industry members can adopt and use anywhere. The scale of the problem indicated organised criminal activity. In particular, certificates relating to training and awareness of hydrogen sulphide were targeted. The threat posed both to the holder of the fraudulent certificate as well as their often unwitting colleagues is obvious. Previously in 2019, Energy Safety Canada confiscated 200 fraudulent certificates; however , as the 2021 incident shows, this was probably just the tip of the iceberg.

In the past, the International Marine Contractors Association (IMCA) have issued warnings about divers using false certificates in a clear case of individuals putting earnings before their personal safety. The danger, cost and difficulty of rescuing a diver in distress is also significant.

In 2016, the. US nuclear regulatory commission reported a case where a contractor at a nuclear power plant falsified training and certification records for security personnel. In the aviation industry there have been many cases of individuals using fraudulent pilot licences and certificates to operate aircraft without proper training. It is incredible how individuals are willing to prioritise their personal needs at the potential expense of the lives of others. In Utilities and related industries, electrical certification fraud creates real risks particularly in power generation and distribution.

In 2023 Australia has issued changes to the Rail Safety National Law in response to a number of examples of rail workers sharing, altering or fabricating safety qualifications. The changes to the law make it an offence to knowingly provide a document or information, for the purposes of an assessment of competency, that is false or misleading.

Workers caught doing so are liable for fines of $10000. In the UK rail industry, there are very clear regulations on shift duration and the amount of rest required to ensure safe working. Nonetheless, this has not stopped workers from creating duplicate access accounts to try to earn extra money.

In the Oil and Gas industry, there are many reports of individuals presenting fraudulent safety certificates, raising concerns about worker safety and environmental risks. On a recent trip to the Middle East, a colleague discovered that there are a number of “businesses” that have been set up to forge various industry certificates – using technology to create credible replicas.

What is clear is that fraudulent use of safety and related certificates is not isolated to one particular industry but seems to be taking place across a variety of safety critical industries. In some cases, individuals are acting on their own and in others, the fraud is organised. With the technology available to potential fraudsters, no one should be surprised at increasingly sophisticated attempts to exploit perceived and real weaknesses in fraud prevention. These efforts undermine safety protocols and create significant personal, asset and environmental threats.

Industry Response to Date

Responses to date have varied widely. Perhaps the most basic check is to go to the issuing body’s website to see what their certificates look like. We know of service providers to

the energy industry who email and phone certificate issuers to check the validity of the documents they’ve been presented with. If this is the only way they can currently validate certificates, then they have no choice but to do so. The problem is that this is very inefficient and time consuming and, depending on their business model, may actually impact margins. Even more serious is the fact that email and phone checks are still not foolproof. Many certificate issuers provide an online system in which the certificate number, if entered, can provide confirmation whether the certificate is real or not. Even if the certificate is deemed to have a genuine number, consideration needs to be given to how to avoid that number being used by more than one person. In the case of Energy Safety Canada, certificates issued by the organisation contain both a holographic seal and a QR code.

It is accurate to say that industry responses to date have been largely reactive, in the hope that tightening processors will be sufficient. As with many other elements of fraud, it should be clear that a systemic and comprehensive approach is required in order to be successful. This will require cross industry collaboration. Few would argue against the benefits of this significantly outweighing the costs.

A future-proof solution for safety critical industries

The problem outlined feels like a great fit with blockchain technology as it provides the potential for a secure and tamper – proof way to issue, verify and manage certificates. So how could this work?

When an organisation issues a certificate, it will create a digital representation of the certificate containing all the relevant information. The digital certificate is hashed, creating a unique fingerprint and stored on the blockchain. Once a certificate has been added to the blockchain, it cannot be altered in any way or deleted. This is what’s known as an immutable record. To further enhance security, certificates can be digitally signed by the issuing authority. A digital signature ensures that the certificate’s contents have not been tampered with and can be traced back to the issuing body.

Anyone with a key is able to access the blockchain to verify the authenticity of a certificate by inputting the certificate details and hash to check that it matches the one stored on the blockchain. If it matches then the certificate is proven to be legitimate. Keys for access can be either private or public. Issuing authorities would have private keys to add certificates to the blockchain while public keys would be freely available to anyone wanting to verify certificates.

Blockchain can also support automated processes through smart contracts. For example at the point a certificate expires, the certificate becomes invalid. Certificates could also be revoked if there is any misconduct. Privacy concerns can be addressed through privacy features in which sensitive data is encrypted while still providing proof of authenticity.

A critical consideration is in achieving widespread use.

Any solution will need to be compatible with existing certificate standards. This means that certificates issued on this blockchain can be recognised and verified by other systems and organisations. Simple, easy to adopt apps and/ or interfaces are required for adoption by both certificate issuers and verifiers.

Implementing a blockchain solution for certificates can significantly reduce the risk of fraudulent use and improve the efficiency of certificate management and verification processes. However, it’s important to carefully plan and execute such a system, considering the unique requirements and challenges of the use case at hand.

Making a start with Skills Passports

Having been selected as the technology partner for the North Sea Transition Deal (NSTD), 3t Digital has now architected and built the Skills Passport. The passport is a single solution enabling workers in the energy sector to hold all of their qualifications in one electronic vault. It is common for workers to have certificates and qualifications from 3 or 4 accrediting bodies and potentially more training providers. In addition, these workers can compare their current qualifications with the requirements for a range of other roles within the sector, highlighting gaps that need closing. In this way, workers are empowered with knowledge around career options and the ability to close identified gaps.

Key to the success of the skills passport is the ability to integrate with the databases of all of the accrediting bodies. These integrations enable this data to be pulled into the passport, forming one coherent picture for any worker.

The Energy Skills Passport is scheduled for industry roll – out in early 2024. Secure access to the solution, together with the identified integrations means that the probability of an individual producing a fraudulent certificate as evidence of readiness to work will be greatly reduced.

In its first iteration, the focus of the passport is clearly on skills. As the solution becomes widely adopted, so the potential for its use to combat fraud and to enhance safety will become clearer.

Revolutionise your workforce development by simplifying processes, automating tasks, and empowering your team!

Want to learn more about how Skills Passports can work for your organisation?

We’d love to show you first-hand how Skills Passports can benefit your organisation. Schedule a consultation with one of our experts at your convenience

man doing rope access work on a wind turbine