ANTI- FRAUD POLICY.
Introduction Concern is committed to the highest possible standards of openness, transparency and accountability in all its affairs.
We wish to promote a culture of honesty and opposition to fraud in all its forms.
The organisation operates in many countries, and in common with many large and decentralised organisations, the size and nature of our operations puts us at risk of loss due to fraud. The purpose of this policy is to provide:
• A clear definition of what we mean by “fraud”
• A definitive statement to staff forbidding fraudulent activity in all its forms
• A summary to staff of their responsibilities for identifying exposures to fraudulent activities and for establishing controls and procedures for preventing such fraudulent activity and/or detecting such fraudulent activity when it occurs.
• Guidance to employees as to action which should be taken where they suspect any fraudulent activity.
• Clear guidance as to responsibilities for conducting investigations into fraud related activities.
• Protection to employees in circumstances where they may be victimised as a consequence of reporting, or being a witness to, fraudulent activities. This document is intended to provide guidance and should be read in conjunction with:
• the relevant Human Resource Policies,
• Overseas Finance Policies & Procedures in relation to Reporting Fraud/Theft and Negligence.
This document will be reviewed periodically in order to determine whether it remains useful, relevant and effective. 2 Concern Anti-Fraud Policy 2010 Web.doc 2. Definitions Concern defines fraud as: “The theft or misuse of Concern’s funds or other resources, by an employee or a third party, which may or may not also involve misstatement of financial documents or records to conceal the theft or misuse” For example, fraud includes but is not limited to the following:
• Theft of funds or any other Concern property
• Falsification of costs or expenses
• Forgery or alteration of documents
• Destruction or removal of records
• Inappropriate personal use of Concern’s assets
• Employees seeking or accepting cash, gifts or other benefits from third parties in exchange for preferment of the third parties in their dealings with Concern
• Blackmail or extortion
• Paying of excessive prices or fees to third parties with the aim of personal gain. 3. Concern Policy Fraud in all its forms is wrong, and is unacceptable to Concern. This is because where fraud occurs:
• It is not just a loss to Concern, but ultimately to our beneficiaries, people living in extreme poverty and the most needy of the world’s citizens
• It may have a major impact on our reputation, on donor confidence and therefore again on our beneficiaries. Concern’s objective is that fraud is eliminated from its activities. Any indications of fraud will be rigorously investigated and dealt with in a firm and controlled way. 4. Responsibilities of Employees a. Managers It is the responsibility of managers to be familiar with the types of fraud that might occur in their area, be alert for any indication of fraud or improper activity and maintain controls to avoid such occurrences.
Managers are required to ensure that all staff under their control be given a copy of this policy in a language they can understand, and acknowledge its receipt. Managers should also ensure that staff be encouraged to report suspected issues of fraud. 3 Concern Anti-Fraud Policy 2010 Web.doc b.
All Staff It is the responsibility of all employees to carry out their work in such a way as to prevent fraud occurring in the workplace. Employees must also be alert for occurrences of fraud, be aware that unusual transactions or behaviours could be indications of fraud, and report potential cases of fraud as outlined below. 5. Reporting Suspected Fraud Employees are required to report issues of suspected fraud. Employees should report their suspicions as follows:
• Overseas staff: To their Line Manager, or to the Country Director
• Country Directors: To the Regional Director where the fraud is in excess of €1,000.
• Staff based in Ireland, UK and USA: To the SMT member responsible for their function
• SMT members: To the Chief Executive and / or Chairperson Employees who suspect fraud should not do any of the following:
• Contact the suspected individual(s) directly in an effort to determine facts, demand explanations or restitution
• Discuss the issue with anyone within Concern other than the people listed above
• Discuss the issue with anyone outside of Concern, except as required by law If the circumstances are such that reporting a suspicion as above is inappropriate, or if the person to whom it is reported is unable to assist, the issue may be reported to the Concern confidential helpline.
This helpline is monitored by the Internal Auditor and is accessed as follows: • By email to email@example.com
• By post marked “Private & Confidential” to Internal Auditor, Corporate Services, Concern, 52-55 Lower Camden Street, Dublin 2, Ireland. 6. Dealing with Reports of Suspected Fraud Any suspicions of fraud will be taken seriously by Concern. Concern expects its managers to deal firmly and quickly with any reports of suspected fraud. Managers receiving reports of suspected fraud must immediately notify the issue and proposed actions to the following:
• Overseas Line Managers: To the Country Director
• Country Directors: To the Regional Director where the fraud is in excess of €1,000. 4 Concern Anti-Fraud Policy 2010 Web.doc
• Regional Directors: To the Overseas Director, Internal Auditor, Finance Director, and Director Human Resources
• SMT Members: To Internal Auditor, Finance Director, and Director Human Resources
• Internal Auditor: To Audit & Risk Committee of Council The purpose of this prompt notification is to allow the sharing of experience of similar situations that may already have arisen elsewhere. 7. Investigation Guidelines In consultation with the persons notified, arrangements must be made for a comprehensive investigation of the issue. The following are responsible for managing these investigations:
• Overseas: Country Director, or any other person nominated by the Regional Director
• Central functions: SMT member responsible, or any other person nominated by the Chief Executive or Chairperson Investigations should be done either by appropriately experienced independent Concern staff, or by independent third parties. An investigation is required to be done without regard to any person’s relationship with Concern, position or length of service. The safeguards for reporting employees must be applied in all cases – see below. All work of the investigation team should be documented, including transcripts of interviews conducted. The conclusion of all fraud investigations must be documented.
The responsible manager should forward the written report/conclusions to the persons requiring notification – see above – and agree the appropriate action to be taken. The person(s) that initially reported the suspicions should be informed of the outcome of the investigation but this should be done only once the report and proposed course of action has been finalised. 8. Safeguards for Employees Issues reported to line management and the helpline will be investigated with the following safeguards. Harassment or Victimisation: Concern recognises that the decision to report a suspicion can be a difficult one to make, not least because of the fear of reprisal from those responsible for the malpractice. Concern in accordance with its Human Resource Policies will not tolerate harassment or victimisation and will take all practical steps to protect those who raise an issue in good faith. 5 Concern Anti-Fraud Policy 2010 Web.doc Confidentiality: Concern will endeavour to protect an individual’s identity when he or she raises an issue and does not want their name to be disclosed. It should be understood, however, that an investigation of any malpractice may need to identify the source of the information and a statement by the individual may be required as part of the evidence. Anonymous Allegations: Concern discourages anonymous allegations. Issues expressed anonymously will be considered at the discretion of Concern. In exercising this discretion, the factors to be taken into account will include:
• The seriousness of the issues raised
• The credibility of the allegations and the supporting facts
• The likelihood of confirming the allegation from attributable sources Untrue Allegations: If an allegation is made in good faith, but it is not confirmed by an investigation, Concern guarantees that no action will be taken against the complainant. If, however, individuals make malicious or vexatious allegations, disciplinary action will be considered against an individual making the allegation. 9. Actions Arising from Fraud Investigations 9.1 Disciplinary procedures Persons who are judged guilty of fraud have committed gross misconduct and will be dealt with in accordance with the HR Policy on Disciplinary Action. Proven allegations of fraud may result in dismissal. Where appropriate, Concern will refer significant fraud to the local law enforcement agencies with a view to initiating criminal prosecution. Consideration should be given to the local context and the consequences in terms of human rights of initiating criminal prosecution against the individuals involved. In every case, the final decision whether or not to prosecute should be taken by:
• Overseas: Regional Director in consultation with the Overseas Director
• Central functions: Chief Executive or Chairperson 9.2 Changes to systems of controls The fraud investigation is likely to highlight where there has been a failure of supervision and / or a breakdown or absence of control; the course of action required to improve systems should be documented in the investigation report and implemented when this report is finalised. 6 Concern Anti-Fraud Policy 2010 Web.doc 9.3 Recovery of losses Where Concern has suffered loss, full restitution will be sought of any benefit or advantage obtained and the recovery of costs will be sought from individual(s) or organisations responsible for the loss. If the individual or organisation cannot or will not make good the loss, consideration will be given to taking civil legal action to recover losses. This is in addition to any criminal proceedings which may result. 10. Effective Date The Anti-Fraud Policy will come into effect immediately upon approval by Council. 11. Review of this Policy In the interests of maintaining best practice, the contents of this Anti-Fraud Policy will be reviewed by the Audit and Risk Committee every three years.