Translink Anti-Fraud Policy - Anti-Fraud Policy And Fraud Response Plan - Freedom Of Information Act - About Us - Translink
Translink Anti-Fraud Policy
Introduction l Definitions - What is Fraud? l Company Responsibilities l Managing the Risk of Fraud - Responsibilities l Fraud Response Plan l Fraud Detection l Reporting l Personal Conduct l Disciplinary/Legal Action l Learning from Experience l Tranlink Public Interest Disclosure Policy l Conclusion l Additional Guidance l Enquiries
1. Introduction
Translink requires all staff at all times to act honestly, and with integrity and to safeguard the Company resources for which they are responsible. Fraud is an ever-present threat to these resources and hence must be a concern to all members of staff. Translink views fraud as an extremely serious matter and is committed to the promotion of an Anti-Fraud Culture throughout the organisation. This section explains Company and staff responsibilities in relation to both prevention and detection of fraud. The Fraud Response Plan at Annex A sets out the procedures to be followed where a fraud is detected or suspected.
Introduction l Definitions - What is Fraud? l Company Responsibilities l Managing the Risk of Fraud - Responsibilities l Fraud Response Plan l Fraud Detection l Reporting l Personal Conduct l Disciplinary/Legal Action l Learning from Experience l Tranlink Public Interest Disclosure Policy l Conclusion l Additional Guidance l Enquiries
2. Definitions - What is Fraud?
In legislation, there is no specific offence of fraud; many of the offences referred to as fraud are covered by the Theft Act (NI)1969 and the Theft (NI) Order 1978. For the purposes of this document, fraud may be defined as (GANI 5.2.1). It may involve:
(i) manipulation, falsification or alteration of records or documents;
(ii) suppression or omission of the effects of transactions from records or documents;
(iii) recording of transactions without substance;
(iv) misappropriation (theft) or wilful destruction or loss of assets including cash; and
(v) deliberate misapplication of accounting or other regulations or policies.
(vi) bribery and corruption
The Company faces exposure in 3 ways (GANI 5.2.3). The criminal act is the attempt to deceive and attempted fraud is therefore treated as seriously as accomplished fraud.
Computer fraud is covered by the Computer Misuse Act 1990. Such fraud arises where information technology equipment has been used to manipulate programs or data dishonestly (for example, by altering, substituting or destroying records, or creating spurious records), or where the use of an IT system was a material factor in the perpetration of fraud. Theft or fraudulent use of computer time and resources is included in this definition.
Some illustrations of incidents which would be classified as fraud are contained in Annex B.
Introduction l Definitions - What is Fraud? l Company Responsibilities l Managing the Risk of Fraud - Responsibilities l Fraud Response Plan l Fraud Detection l Reporting l Personal Conduct l Disciplinary/Legal Action l Learning from Experience l Tranlink Public Interest Disclosure Policy l Conclusion l Additional Guidance l Enquiries
3. Company Responsibilities
Translink responsibilities as part of DRD are set out in chapter 5 of Government Accounting Northern Ireland (GANI).
“Translink must undertake fraud investigations where there is suspected fraud and take the appropriate legal and/or disciplinary action in all cases where that would be justified. Where there is fraud (proven or suspected), Translink should make any necessary changes to systems and procedures to prevent similar frauds occurring in the future. Translink should establish systems for recording and subsequently monitoring all discovered cases of fraud (proven or suspected). (GANI, 5.2.14 - 18). Guidance on when to involve the PSNI Fraud Squad and Serious Fraud Office is given at GANI, 5.2.19.
Responsibility for exercising disciplinary powers rests with the Director of Finance, although this should be done in consultation with other Executives where appropriate (GANI, 5.2.18).
Translink will let DRD have details of all discovered fraud, proven or suspected, on an annual basis. All frauds will be reported immediately (5.3.1), however subject to prior approval from DFP and NIAO, certain types or groups of frauds will be reported on an agreed basis. An example would include recurring or high volume frauds being reported at regular intervals. Novel or substantial frauds will be reported immediately.
Translink will submit an annual fraud return in response to the Department of Finance and Personnel’s commissioning letter (GANI 5.3.2 - 4).”
Introduction l Definitions - What is Fraud? l Company Responsibilities l Managing the Risk of Fraud - Responsibilities l Fraud Response Plan l Fraud Detection l Reporting l Personal Conduct l Disciplinary/Legal Action l Learning from Experience l Tranlink Public Interest Disclosure Policy l Conclusion l Additional Guidance l Enquiries
4. Managing the Risk of Fraud - Responsibilties
The Director of Finance is responsible for establishing and maintaining a sound system of internal control that supports the achievement of Company policies, aims and objectives. The system of internal control is designed to respond to and manage the whole range of risks that Translink faces. The system of internal control is based on an on-going process designed to identify the principal risks, to evaluate the nature and extent of those risks and to manage them effectively. Managing fraud risk will be seen in the context of the management of this wider range of risks.
Overall responsibility for managing the risk of fraud has been delegated to Line Managers/Internal Auditor. Their responsibilities include:-
- Developing a fraud risk profile and undertaking a regular review of the fraud risks associated with each of the key organisational objectives in order to keep the profile current;
- Establishing an effective anti-fraud policy and fraud response plan, commensurate to the level of fraud risk identified in the fraud risk profile;
- Designing an effective control environment to prevent fraud commensurate with the fraud risk profile;
- Establishing appropriate mechanisms for:
- reporting fraud risk issues;
- reporting significant incidents of fraud to the Director of Finance and Human Resources;
- co-ordinating assurances about the effectiveness of anti-fraud policies; - Liaising with the Risk Management Committee and/or Audit Committee;
- Making sure that all staff are aware of the organisation’s anti-fraud policy and know what their responsibilities are in relation to combating fraud;
- Developing skill and experience competency frameworks;
- Ensuring that appropriate anti-fraud training and development opportunities are available to appropriate staff in order to meet the defined competency levels;
- Ensuring that vigorous and prompt investigations are carried out if fraud occurs or is suspected;
- Taking appropriate legal and/or disciplinary action against perpetrators of fraud;
- Taking appropriate disciplinary action against supervisors where supervisory failures have contributed to the commission of fraud;
- Taking appropriate disciplinary action against staff who fail to report fraud;
- Taking appropriate action to recover assets;
- Ensuring that appropriate action is taken to minimise the risk of similar frauds occurring in future.
Managers are responsible for:
- Ensuring that an adequate system of internal control exists within their areas of responsibility and that controls operate effectively;
- Preventing and detecting fraud;
- Assessing the types of risk involved in the operations for which they are responsible;
- Regularly reviewing and testing the control systems for which they are responsible;
- Ensuring that controls are being complied with and their systems continue to operate effectively;
- Implementing new controls to reduce the risk of similar fraud occurring where frauds have taken place
Internal audit is responsible for:
- Delivering an opinion to the Director of Finance and Audit Committee on the adequacy of arrangements for managing the risk of fraud and ensuring that the Company promotes an anti-fraud culture;
- Assisting in the deterrence and prevention of fraud by examining and evaluating the effectiveness of controls commensurate with the extent of the potential exposure/risk in the various segments of the department’s operations;
- Ensuring that management has reviewed its risk exposure and identified the possibility of fraud as a business risk;
- Assisting management in conducting fraud investigations.
Every member of staff is responsible for:
- Acting with propriety in the use of Company resources and the handling and use of Company funds whether they are involved with cash or payments systems, receipts or dealing with suppliers. Staff should not accept gifts valued at more than £15, hospitality or benefits of any kind from a third party which might be seen to compromise their integrity;
- Being alert to the possibility that unusual events or transactions could be indicators of fraud;
- Reporting details immediately through the appropriate channel if they suspect that a fraud has been committed or see any suspicious acts or events;
- Co-operating fully with whoever is conducting internal checks, reviews or fraud investigations.
Line managers are responsible for ensuring that an adequate system of internal control exists within their areas of responsibility and that controls operate effectively. The responsibility for the prevention and detection of fraud, therefore, rests primarily with managers.
There is a need for all managers to assess the types of risk involved in the operations for which they are responsible; to review and test regularly the control systems for which they are responsible; to ensure that controls are being complied with; and to satisfy themselves that their systems continue to operate effectively.
Line managers should also ensure that all staff are aware of the organisation’s anti fraud policy and know what their responsibilities are in relation to combating fraud.
Internal Audit is available to offer advice and assistance on control issues as necessary. In terms of establishing and maintaining effective controls it is generally desirable that:
(i) supervisory/management checks are established in each area of work, and such checks are carried out routinely and periodically by management;
(ii) there is a regular rotation of staff where practicable, particularly in key posts;
(iii) wherever possible, there is a separation of duties so that control of a key function is not vested in one individual;
(iv) back-logs are not allowed to accumulate; and
(v) in designing any new system, consideration is given to building in safeguards against internal and external fraud.
Introduction l Definitions - What is Fraud? l Company Responsibilities l Managing the Risk of Fraud - Responsibilities l Fraud Response Plan l Fraud Detection l Reporting l Personal Conduct l Disciplinary/Legal Action l Learning from Experience l Tranlink Public Interest Disclosure Policy l Conclusion l Additional Guidance l Enquiries
5. Fraud Response Plan
Translink has prepared a Fraud Response Plan (see Annex A) as a guide to follow in the event of fraud being discovered or suspected. The plan should be read in conjunction with the detailed guidance set out in the booklet “Dealing with Suspected Fraud” issued by DRD Personnel Division in June 2003.
Introduction l Definitions - What is Fraud? l Company Responsibilities l Managing the Risk of Fraud - Responsibilities l Fraud Response Plan l Fraud Detection l Reporting l Personal Conduct l Disciplinary/Legal Action l Learning from Experience l Tranlink Public Interest Disclosure Policy l Conclusion l Additional Guidance l Enquiries
6. Fraud Detection
Line managers should be alert to the possibility that unusual events or transactions could be symptoms of fraud or attempted fraud. Fraud may also be highlighted as a result of specific management checks or be brought to management's attention by a third party. Additionally, irregularities occasionally come to light in the course of audit reviews.
Irrespective of the source of suspicion, it is for line management to undertake an initial enquiry to ascertain the facts. This enquiry should be carried out as speedily as possible after suspicion has been aroused: prompt action is essential. The purpose of the initial enquiry is to confirm or repudiate the suspicions which have arisen so that, if necessary, further investigation may be instigated.
The factors which gave rise to the suspicion should be determined and examined to clarify whether a genuine mistake has been made or an irregularity has occurred. An irregularity may be defined as any incident or action which is not part of the normal operation of the system or the expected course of events.
Preliminary examination may involve discreet enquiries with staff or the review of documents. It is important for staff to be clear that any irregularity of this type, however apparently innocent, will be analysed.
If initial examination confirms the suspicion that a fraud has been perpetrated, then to prevent the loss of evidence which may prove essential for subsequent disciplinary action or prosecution, Management should:
(i) take steps to ensure that all original evidence is secured as soon as possible;
(ii) be able to account for the security of the evidence at all times after it has been secured, including keeping a record of its movement and signatures of all persons to whom the evidence has been transferred. For this purpose all items of evidence should be individually numbered and descriptively labelled;
(iii) not alter or amend the evidence in any way;
(iv) keep a note of when they came into possession of the evidence. This will be useful later if proceedings take place;
(v) remember that all memoranda relating to the investigation must be disclosed to the defence in the event of formal proceedings and so it is important to carefully consider what information needs to be recorded. Particular care must be taken with phrases such as “discrepancy” and “irregularity” when what is really meant is fraud or theft.
Additionally, Translink may suspend any member of staff involved pending the outcome of an investigation (sections 8 and 13 of the document “Dealing with Suspected Fraud” provides guidance). Suspension itself does not imply guilt; it can be however another safeguard to prevent the removal or destruction of evidence.
Introduction l Definitions - What is Fraud? l Company Responsibilities l Managing the Risk of Fraud - Responsibilities l Fraud Response Plan l Fraud Detection l Reporting l Personal Conduct l Disciplinary/Legal Action l Learning from Experience l Tranlink Public Interest Disclosure Policy l Conclusion l Additional Guidance l Enquiries
7. Reporting
Managers are required to report immediately to the Director of Finance all proven or suspected fraud within the Companies perpetrated by members of its own staff, members of the public, creditors or contractors. Guidance on how fraud (proven or suspected) should be reported, is set out in the Fraud Response Plan attached at Annex A.
Introduction l Definitions - What is Fraud? l Company Responsibilities l Managing the Risk of Fraud - Responsibilities l Fraud Response Plan l Fraud Detection l Reporting l Personal Conduct l Disciplinary/Legal Action l Learning from Experience l Tranlink Public Interest Disclosure Policy l Conclusion l Additional Guidance l Enquiries
8. Personal Conduct
Staff should not accept gifts valued at more than £25, hospitality or benefits of any kind from a third party which might be seen to compromise their integrity. All such instances should be recorded in the Hospitality Register.
Introduction l Definitions - What is Fraud? l Company Responsibilities l Managing the Risk of Fraud - Responsibilities l Fraud Response Plan l Fraud Detection l Reporting l Personal Conduct l Disciplinary/Legal Action l Learning from Experience l Tranlink Public Interest Disclosure Policy l Conclusion l Additional Guidance l Enquiries
9. Disciplinary / Legal Action
After proper investigation, Translink will take legal and/or disciplinary action in all cases where it is considered appropriate and there will be consistent handling of cases without regard to position or length of service.
In general, Translink policy in regard to proven frauds or suspected frauds which come to light, whether perpetrated by a member of staff or by persons external to the organisation, is that the case will be referred to the police at the earliest possible opportunity.
Translink will co-operate fully with police enquiries and these may result in the offender(s) being prosecuted. Steps need to be taken to attempt to recover all losses resulting from the fraud. A civil action against the perpetrator may be appropriate.
The investigations described above will also consider whether there has been any failure of supervision. Where this has occurred appropriate disciplinary action will be taken against those responsible.
Introduction l Definitions - What is Fraud? l Company Responsibilities l Managing the Risk of Fraud - Responsibilities l Fraud Response Plan l Fraud Detection l Reporting l Personal Conduct l Disciplinary/Legal Action l Learning from Experience l Tranlink Public Interest Disclosure Policy l Conclusion l Additional Guidance l Enquiries
10. Learning from Experience
Where a fraud has occurred management must make any necessary changes to systems and procedures to ensure that similar frauds will not recur. The investigation may have pointed up where there has been a failure of supervision, a breakdown in or an absence of control. Internal Audit is available to offer advice and assistance on matters relating to internal control.
Introduction l Definitions - What is Fraud? l Company Responsibilities l Managing the Risk of Fraud - Responsibilities l Fraud Response Plan l Fraud Detection l Reporting l Personal Conduct l Disciplinary/Legal Action l Learning from Experience l Tranlink Public Interest Disclosure Policy l Conclusion l Additional Guidance l Enquiries
11. Translink Public Interest Disclosure Policy (Whistleblowing)
Introduction
All of us at one time or another have concerns about what is happening at work. Usually these concerns are easily resolved. However, when they are about unlawful conduct, financial malpractice, dangers to the public, serious safety or security issues or a breach of confidence, it can be difficult to know what to do.
You may be worried about raising such issues or may want to keep the concerns to yourself, perhaps feeling it is none of your business or that it is only a suspicion. You may feel that raising the matter would be disloyal to colleagues, Managers or the Company. You may decide to say something but find that you have spoken to the wrong person or raised the issue in the wrong way and are not sure what to do next.
Translink has introduced this procedure to enable you to raise your concerns about such malpractice at an early stage and in the correct manner. We would rather that you raised the matter when it is just a concern rather than wiat for proof. If something is troubling you which you think we should know about or look into, please use this procedure. If, however, your concern is in relation to your personal position, please use the Grievance Procedure.
This Public Interest Disclosure procedure is primarily for concerns where the interest of others or of the Organisation itself are at risk. It is not designed to question financial or business decisions taken by management nor should it be used to reconsider any matters which have already been addressed under other procedures. If in doubt – raise it!
Scope of Policy
This policy applies not only to all permanent and short term employees of Translink, but also to external consultants, contractors and agency staff working within Translink.
It is impossible to give an exhaustive list of the activities that could cause concern, but they include:
- Financial malpractice, impropriety or fraud
- Failure to comply with a legal obligation
- Regulatory non compliance
- Dangers to health and safety or the environment
- Criminal activity
- Attempts to conceal any of the above.
Our Assurances to you
- Your Protection
The Chief Executive, Senior Management and all Managers, are committed to this policy. If you raise a genuine concern under this policy, you will not be at risk of losing your job or suffering any form of retribution as a result. Provided you are acting in good faith, it does not matter if you are mistaken. This assurance is not extended to someone who maliciously raises a matter they know is untrue or to someone who chooses to make disclosures outside the scope of the procedures set out in this policy.
The Public Interest Disclosure Order, which came into effect in 1999, gives legal protection to employees against being dismissed or penalised by their employer as a result of disclosing certain serious concerns.
- Your Confidence
The Company will not tolerate the harassment or victimization of anyone raising a genuine concern. However, we recognise that you may nonetheless want to raise a concern in confidence under this policy. If you ask us to protect your identity by keeping your confidence, we will not disclose it without your consent. If the situation arises where we are not able to resolve the concern without revealing your identity (for instance because your evidence is needed in court), we will discuss with you whether and how we can proceed.
- Anonymous Report
In order to protect employees from abuse we cannot accept anonymous reports under this policy.
How to raise a concern internally
Option One
If you have a concern about malpractice, we hope you will feel able to raise it first with your Line Manager. This may be done orally or in writing.
Option Two
If you feel unable to raise the matter with your Line Manager, for whatever reason, please raise the matter with any other manager in the Company. Please state if you want to raise the matter in confidence so that they can make appropriate arrangements.
Option Three
If these channels have been followed and you still have concerns, or if you feel that the matter is so serious that you cannot discuss it with any of the above, please contact:
- Alan Mercer, Director of Human Resources
Direct Line: 028 90899407 - Philip O'Neill, Acting Chief Executive
Direct Line: 028 90899402 - If you prefer, you may raise the matter directly with Jim Aiken, Director of Corporate Services, at the NI Transport Holding Company.
How we will handle the matter
Once a concern has been raised, we will consider initially what action should be taken. This may involve an internal inquiry or a more formal investigation. We will tell you who is handling the matter, how you can contact him/her and whether your further assistance may be required. If you request, we will write to you within 10 days summarising your concern and setting out how we propose to handle it.
When you raise the concern you may be asked how you think the matter might best be resolved. Meetings between the employee raising the concern and the person handling the concern and/or the investigator can take place away from Translink premises at the requst of either party.
The employee can be accompanied to any meetings by a fellow employee of their choice who may be a friend, colleague or a Trade Union representative.
If you do have any personal interest in the matter, we do ask that you tell us at the start of the process. If your concern falls more appropriately within the Grievance Procedure we will recommend that route to you.
While the purpose of this policy is to enable us to investigate possible malpractice and take appropriate steps to deal with it, we will give you as much feedback as we can. If requested, we will confirm our response to you in writing. Please note, however, that we may not be able to tell you the precise action we take where this would infringe in a confidence to someone else.
If you are dissatisfied
If you are unhappy with our response, remember you can go to the other levels and bodies detailed in this policy. While we cannot guarantee that we will respond at all matters in the way that you might wish, we will try to handle the matter fairly and properly. By using this policy, you will help us to achieve this.
Independent Advice
If you are unsure whether to use this procedure or you want independent advice at any stage, you may contact, if applicable the independent charity Public Concern at Work on 0207 404 6609. or at helpline@pcaw.co.uk Their Lawyers can give you free confidential advice at any stage about how to raise a concern about serious malpractice at work.
External contacts
While we hope this policy gives you the reassurance you need to raise such matters internally, we recognize that there may be circumstances where you feel you can report matters to outside bodies. Public Concern at Work (or, your Trade Union) will be able to advise you on such an option and on the circumstances in which you any be able to contact an outside body.
Monitoring this Policy
The Director of Corporate Services at the NI Transport Holding Company will maintain a confidential record of concerns raised under this policy together with the outcome and will report as necessary to the Audit Committee.
Review of Policy
The Audit Committee has a responsibility to review this policy annually, including an assessment of its effectiveness. Changes to the policy will be notified to employees when they occur.
Introduction l Definitions - What is Fraud? l Company Responsibilities l Managing the Risk of Fraud - Responsibilities l Fraud Response Plan l Fraud Detection l Reporting l Personal Conduct l Disciplinary/Legal Action l Learning from Experience l Tranlink Public Interest Disclosure Policy l Conclusion l Additional Guidance l Enquiries
12. Conclusion
The circumstances of individual frauds will vary. But it is important that all are vigorously and promptly investigated and that appropriate action is taken. To repeat, Translink views fraud extremely seriously and all suspicion of fraud will be acted upon in accordance with this policy. Proven fraud can ultimately result in dismissal.
Introduction l Definitions - What is Fraud? l Company Responsibilities l Managing the Risk of Fraud - Responsibilities l Fraud Response Plan l Fraud Detection l Reporting l Personal Conduct l Disciplinary/Legal Action l Learning from Experience l Tranlink Public Interest Disclosure Policy l Conclusion l Additional Guidance l Enquiries
13. Additional Guidance
Additional guidance on the issue of fraud is contained in the following list of key documents readily available from the Director of Finance.
Government Accounting Northern Ireland, Chapter 5
DAO (DFP) 11/03, Fraud Management and Fraud Reporting
HM Treasury Booklet, “Managing The Risk of Fraud”
DRD Personnel Division Booklet, “Dealing with Suspected Fraud”
CSC 04/03, Guidance on Public Interest Disclosure (“whistleblowing”)
The Seven Principles of Public Life (Nolan Principles)
Introduction l Definitions - What is Fraud? l Company Responsibilities l Managing the Risk of Fraud - Responsibilities l Fraud Response Plan l Fraud Detection l Reporting l Personal Conduct l Disciplinary/Legal Action l Learning from Experience l Tranlink Public Interest Disclosure Policy l Conclusion l Additional Guidance l Enquiries
14. Enquiries
Enquiries about this document should be addressed to Stephen Armstrong, Director of Finance, 3 Milewater Road, Belfast BT3 9BG - Tel: 028 9035 4057 or Email: stephen.armstrong@translink.co.uk
Should any questions remain in relation to fraud, e.g. as to whether a matter needs to be reported, either the Internal Auditor or Group Accountant will be happy to discuss.
STEPHEN ARMSTRONG
DIRECTOR OF FINANCE
MAY 2007
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