This week, we learned what fraud is, its impact on us, and what conditions are generally present when fraud occurs. We also learned the importance of internal controls in limiting the opportunity for fraud to occur. However, despite our best efforts fraud can and will still happen.
Over 40% of all frauds are uncovered through tips.
The Association of Certified Fraud Examiners, in its 2016 Report to the Nations on Occupational Fraud and Abuse, found tips are the most common fraud detection method. This is, in part, why the statewide Code of Conduct Policy requires employees to report “any suspected code of conduct and ethics violations, significant internal control deficiencies, evidence of theft, embezzlement, unlawful use of public funds or property, or any other irregularities or wrongdoings.” It is important for each agency to promote a “speak-up” culture, encouraging employees to report what they know or suspect.
Detection is a pillar of fraud prevention.
Each of us should be familiar with our agency’s specific channel for reporting suspected fraud and internal control weaknesses. Employees must also report certain cases of suspected fraud to the Minnesota Office of the Legislative Auditor. State managers and supervisors should understand their agency’s reporting channels and be ready to assist if employees have something they wish to report. Any employee who reports a suspected violation in good faith is covered by the state’s Whistle-blower Act. Finally, check out the Fraud Reporting Resources page to find out how you can report suspected fraud.
Thanks for your commitment to helping prevent fraud in Minnesota State Government.