FRAUD, WASTE, AND ABUSE
Acts of Fraud, Waste and/or Abuse depletes the time, effort and resources of the County. Fraud, waste or abuse can occur through unintentional acts or it can occur by deliberate actions. Regardless of the intent, fraud, waste and/or abuse cannot be tolerated. Therefore, each employee is expected to report suspected fraud, waste and/or abuse either to your supervisor or through the Fraud Hotline.
The following definitions are provided to help you understand how these categories of activities differ from each other:
Fraud: The intentional deception perpetrated by an individual or individuals, or an organization or organizations, either internal or external to the County, which could result in a tangible or intangible benefit to themselves, others, or the County or could cause detriment to others or the County. Fraud includes a false representation of a matter of fact, whether by words or by conduct, by false or misleading statements, or by concealment of that which should have been disclosed, which deceives and is intended to deceive. Examples of fraud actives include, but are not limited to: Forgery or alteration of documents (checks, contracts, purchase orders, invoices, time sheets, or any other financial document); Misappropriation of funds, equipment, supplies, or other assets; Improprieties in the handling or reporting of financial transactions.
Waste: The intentional or unintentional, thoughtless or careless expenditure, consumption, mismanagement, use, or squandering of County resources to the detriment or potential detriment of the County. Waste also includes incurring unnecessary costs as a result of inefficient or ineffective practices, systems, or controls.
Abuse: Excessive or improper use of a thing, or to employ something in a manner contrary to the natural or legal rules for its use. Intentional destruction, diversion, manipulation, misapplication, maltreatment, or misuse of County resources such as tools, vehicles, computers, copy machines, etc. Extravagant or excessive use as to abuse one‘s position or authority. Abuse can occur in financial or non-financial settings.
|RED FLAGS OF FRAUD
A red flag is a set of circumstances that are unusual in nature or vary from the normal activity. It is a signal that something is out of the ordinary and may need to be investigated further. Remember that red flags do not indicate guilt or innocence but simply provide possible warning signs of frauds. The red flags may be present, when fraud actually isn’t. Therefore, one should avoid jumping to conclusions.
|Common Personality of Fraudsters||§ Wheeler and Dealers
§ Don’t like people reviewing their work
§ Strong desire for personal gain
§ Have a “Beat the System Attitude”
§ Live beyond their means
§ Close relationship with customers vendors
|§ Often have a “too good to be true” work performance
§ Don’t take vacation or sick time or only take leave in small amounts
§ Outwardly, appear to be very trustworthy
§ Often display some sort of drastic change in personality or behavior
§ Unable to relax
§ Often work excessive overtime
|Common Sources of Pressure||§ Medical problems-especially for a loved one
§ Unreasonable performance goals
§ Spouse loses a job
§ Starting a new business or current business is struggling
|§ Criminal Conviction/Civil Lawsuit.
§ Purchase of a new home, a second home, or a home remodel
§ Excessive gambling
§ Drug or alcohol addiction
§ Need to maintain a certain lifestyle
|Changes in Behavior||§ Suddenly appears to be buying more material items – houses, cars, boats, clothes, jewelry, electronics, etc.
§ Brags about new purchases
§ Starts to carry unusual amounts of cash
§ Creditors/Bill collectors show up at work or call frequently
§ Borrows money from coworkers
§ Becomes more irritable or moody
§ Becomes unreasonable upset when questioned
§ Becomes territorial over their area of responsibility
§ Works unneeded overtime
|§ Won’t take vacation or sick time or only takes it in small increments
§ Turns down promotions
§ Start coming in early or staying late
§ Redo or rewrite work to “make it neat”
§ May start to mention family or financial problems.
§ Exhibits signs of a drug or gambling addiction (absenteeism, become manipulative, look ill, inconsistent or illogical behavior, loss of sleep or appetite, etc.)
§ Exhibits signs of dissatisfaction (decrease in productivity, change attire, irregular schedules, frequent complaining about inequities or work issues)