Corruption is found in all countries, but the extent and scope varies. Fragile and conflict affected states are in particular exposed to corruption. Transparency International’s corruption index ranks countries based on how their public sector is perceived. Not surprisingly, many countries where NRC works are ranked as the most corrupt countries in the world. Hence understanding and fighting corruption in the different contexts in the countries we work, require extra attention and efforts.
NRC defines corruption as “the abuse of power for illegitimate individual or group benefits”. This involves financial and non-financial benefits. We have zero tolerance against corruption, and NRC employees are not allowed to provide for, request or receive anything that can be defined as corruption.
To help and support staff and management in avoiding and handling corruption cases, we have a detailed Code of Conduct, Anti-corruption guidelines, strict Human Resource, Logistics and Financial procedures, coupled with whistle blowing, Monitoring & Evaluation and Risk Management systems put in place. Awareness raising and context specific anti-corruption trainings and risk mappings are done on a regular basis in the programme countries, and our procedures and control mechanisms are constantly strengthened and adjusted to further improve our global and country specific prevention measures.
Support and programme functions in humanitarian operations and acute emergencies are in particular exposed to corruption. However, our experience is that regular monitoring, including unannounced spot checks, and segregation of duties generally serve as effective prevention measures.
Assessing and investigating alleged corruption and proving evidence is important, but can be resource demanding, difficult and even dangerous. In criminal cases we alert the police and take legal action, if appropriate. In some countries however, the police and prosecutors can be part of the crime or otherwise corrupt, thus in certain cases/countries extra care and discretion must be used before taking legal action.
NRC encourages open discussions and acknowledges that corruption may occur even under the best of control systems, due to the very challenging environments in which we operate. Our policy is to be transparent, and one element of that is that we by June 30 each year publish an overview of the corruption cases that were closed the previous year.
The following cases were concluded in 2013. They were all detected as a result of our internal control mechanisms. Respective donors have been informed during the processes and where money has been lost the loss has been covered by NRC.
Case 1) An employee left NRC end 2012 taking with him a laptop, cash advances and financial documents including receipts of paid goods, altogether totalling USD 14,373. The money could not be recovered from the employee.
Case 2) A discrepancy between a cashbox balance from a field office and the money in hand, counted at the end of February 2013 was detected. The person in charge admitted the circumstances, but claimed it to be unintentional and returned the money, which according to the employee had been kept in an envelope in the safe all the time. The employee then decided to resign and left the office end of April.
Case 3) During the closing process of April it was discovered that a number of postings in the cashbox from the same field office as case 2, had been paid by check and did not belong to that cashbox. When this was corrected USD 10,243 appeared as missing money and another Finance Officer submitted a resignation letter on the grounds of increased workload after the colleague (from case 2) had resigned. Even after a thorough investigation of the theft there is still lack of evidence on what the roles of the two staff members could have been.
The following internal measures were afterwards taken to secure future compliance with NRCs procedures: tighter internal control mechanisms after a thorough scrutiny of each step of the financial process in the office. The documentation trail has changed; more staff is checking paper trails and processes; all cash advances are followed up more frequently and tracked in NRC’s accounting software system and the cash advance limit and timing for settlement have been tightened. Anti-corruption trainings of all staff were held and the Finance & Administration Manager and other international managers paid more frequent control visits to the field offices. Monthly reconciliations are hereinafter done at field office level and the Area Manager submits a signed copy to the country office with the monthly closing.
Case 1) Plastic sheetings meant for shelter construction went missing and the case was investigated by the police, the donor and NRC. The police found and confiscated seven pieces of plastic sheeting in a refugee household. However the investigations never managed to prove who the guilty ones were or to determine the exact quantity of the stolen plastic sheetings.
Case 2) Bribery in the procurement and supply of bush rope, total contract value USD 1700, was detected and involved staff, incentive construction workers, refugee community members and vendors.
NRC has taken the following internal actions:
Review of warehouse procedures, improved supervision of shelter works, and more data required from contractors, increased finance and logistics trainings, dismissal of one employee, warning letter and a verbal warning to two other employees.
A conflict of interest case involving two senior staff members in a field office was detected; as it was proved that they owned one car each in a transportation company the field office had started to use January 2013. Their cars had been rented and paid by NRC 6 times each, at the total cost of USD 1960, equal to 31% of the total contract with the company.
As a consequence the two staff members’ contracts were terminated and another staff member got a written warning and was moved to another field office. Extra focus and trainings on NRC’s logistics procedures and the importance of Code of Conduct compliance throughout the country operation has since then been conducted. The investigation gave no indication that the transportation costs were above the market price and hence no financial loss for NRC.
In June 2013 widespread corruption allegations against one of NRC’s field offices appeared in the local media.
The investigation concluded that no evidence of corruption was found, but there was a breach of compliance with NRC’s beneficiary selection procedures, the selection process of implementing partners was weak and the overall programme management should have been stronger. This resulted in gaps and less transparency in the project implementation. All these processes have now been strengthened.
An IT officer made several fake invoices and got reimbursed for both the originals and the fake invoices amounting to USD 318, before the fraud was detected.