In 2018 a new round of awareness raisings and context specific anti-corruption trainings were done in the programme countries. We also continued to arrange investigation trainings of key staff. 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.
During 2018, a total of 61 cases of alleged corruption/financial misconduct were investigated. One of the investigations was done by external experts, the rest by internal investigation teams, following NRC’s investigation procedures. All cases were detected as a result of NRC’s internal control measures or through whistle blowing. In each of the cases where irregularities or misconduct were found we have learned from the incidents. Affected donors have been informed and where money has been lost the loss has been covered by NRC and/or wherever possible the loss has been recovered from the staff in question. Proper prevention measures were applied accordingly, and appropriate level of disciplinary actions taken according to NRC policy and local law.
Out of the investigated cases, 29 cases were found to be either groundless, not substantiated or related to negligence and bad performance (rather than of a Code of Conduct nature). 7 cases were avoided due to early detection and 3 cases are pending conclusion.
Concluded corruption cases from 2018
In the cases presented below, it was concluded that corruption/financial irregularities had taken place:
Central African Republic
Case 1) Theft of wood
In June, following detection of missing wood and lack of proper stock control in a sub office, NRC decided to launch an investigation. The investigation concludes that NRC had lost wood through routine theft of wood for a total value of USD 13,449, but it was not possible to pin the theft on any person(s).
Democratic Republic of Congo
Case 1) Bribe extortion
In June, NRC was informed of an alleged corruption case within the education programme. The investigation found that three staff members had requested bribes from school directors, estimated at USD 1,600 in total, in exchange of NRC’s assistance with construction and school furniture.
Case 1) Conflict of interest
In November, through internal control NRC found indications of possible procurement fraud in one of the area offices. An external investigation firm was appointed to investigate the matters and concluded there was a conflict of interest between a staff member and two suppliers and indications of collusion among some suppliers. No identifiable loss was discovered.
Case 1) Theft of equipment
In April, when a Gender Based Violence team should distribute some project items, they found some items to be missing. It was not possible to obtain enough evidence to prove the theft or to pin it on a person(s).
Case 2) Fuel theft
In August, NRC was informed by a fuel supplier that a staff member allegedly was stealing fuel by filling extra fuel on a jerry can and charging it on NRC when filling fuel on the NRC cars. Further checks confirmed the theft and it was estimated to have happened ten times, which constituted a loss of USD 150.
Case 3) Conflict of interest
In September, NRC’s management received information that a staff member had selected four family members as beneficiaries onto a livelihoods training. Assessments showed that the staff member had failed to declare two (extended) family members, but all family members fulfilled NRC’s selection criteria and hence there was no financial loss.
Case 1) Fuel theft
In November, 714 litres of fuel were reported stolen in Kenya. Suspicions of involvement of both an external security guard and NRC staff were investigated. The investigation did however not manage to provide enough evidence to prove involvement of either parties. The value of the fuel was USD 760.
Case 2) Conflict of interest
In February, a whistle blow was accusing another staff of inciting the community against the NRC and infringing procurement processes to exploit loopholes. The investigation found that the complainant and the subject of the complaint had serious personal differences and that both individuals had issues of declaration of conflict of interests related to the businesses of their relatives who had been prequalified by NRC. There was no tangible loss.
Case 1) Fuel theft
In April, NRC became aware of a possible fuel theft case. The investigation confirmed that a staff member had charged NRC’s fuel card when filling fuel for private use on several occasions. The estimated loss was between USD 200-300, but due to the fuel company’s failure to follow established procedures and verify the car registration upon fuelling, they accepted to cover the loss.
Case 2) Attempted theft
In January, a laptop was reported stolen. It was however returned to NRC as a result of the investigation process.
Case 1) Fraud
In February, NRC uncovered some irregularities within an education project which resulted in an investigation. The investigation found that out of 54 reported and paid education centres, one centre had not yet been built and another education centre was not operational. The investigation revealed poor project implementation and oversight by NRC and concluded that the construction company and a community-based facilitator had committed fraud by charging NRC for services that had not occurred.
Case 1) Attempted price inflation
In June, through internal control it was discovered that the prices in some requests for quotations were surprisingly high, which triggered an investigation. The subject resigned during the course of the investigation. There was no financial loss, since these cases were detected before any payments were done.
Case 1) Price inflation
In July, NRC received a whistle blow of an alleged fraud case in which a staff member had inflated the price of vehicle licenses. The investigation revealed a financial loss of USD 35. The amount was recovered by the subject.
Case 1) Misuse of funds by a local partner
In June, NRC was informed of alleged misuse of funds by a local partner. The investigation discovered that 15 reported beneficiaries from Information, Counselling and Legal Assistance services could not confirm receiving assistance or were non-verifiable. The total loss is estimated at USD 1,650.
Case 2) External fraud
In July, NRC was informed of an external fraud case in which a former causal worker had falsely claimed to be working for NRC and allegedly requested and received USD 10,000 from a family for a bore hole at their farm. The case was reported to the local police.
Case 1) Financial mismanagement - local partner
In July, a whistle blow contained various allegations of mismanagement and corruption within a local partner organisation. A Multi-Agency Investigation team was formed by representatives of the INGOs who had been partnering with the local organisation to deliver different programmes inside Syria. Most allegations were dismissed, but the investigation provided some evidence of financial mismanagement and indications of salary being paid to a ghost staff member. NRC values it suffered a total loss of USD 26,726.
Case 2) inflated prices - local partner
In July, NRC was informed by a local partner that they had identified discrepancies and initiated an internal investigation. During the investigation the scope was widened and included NRC’s bread distribution projects. The investigation concluded that NRC’s projects had been subject to inflated costs. The actual bread distribution happened, and the beneficiaries were targeted. Two staff members from the local partner organisation confessed that they had been bribed by the supplier who had inflated the costs. The staff paid back USD 9,583 to their employer. With the recovered amount of USD 9583, NRCs real loss was is USD 27,972.
Case 3) False reimbursement claim
In April, NRC uncovered a false reimbursement claim of USD 35 from a staff. The claim was discovered before payments were made and financial losses were therefore avoided.
Case 4) External fraud
In May, NRC issued a closed tender with a value of USD 800,000. It was later discovered that the assigned supplier had faked and falsified registration documents to win the tender. The discovery was made after the first instalment of the service contract. Despite the fraudulent document submissions, the service was delivered adequately, and NRC did therefore not suffer any financial loss. The remainder of the contract has nevertheless been re-tendered to a different company.
Case 1) Theft of mobile phones
In November, NRC discovered a loss of 100 mobile phones (earmarked for zone, village and cluster leaders) totalling a value of USD 2,983. The investigation established that NRC staff were behind the theft.
Case 2) Theft of non-food items
In October, a spot check of items in the NRC Rub Hall warehouse revealed that several items were missing. The investigation established that 12 boxes of soap, 8 bales of blankets, 4 bales of mats and one solar lamp to a total value of USD 1,372 were stolen. It further concludes that persons involved in the storage and the distribution most likely colluded and were behind the theft.
Case 1) Conflict of interest
In July, through internal control a possible conflict of interest case was detected, involving a staff member who appeared to be associated with a service provider under a contract with NRC. The subsequent investigation confirmed the suspicion and found that the subject had not declared any conflict of interest and had participated in the selection of the service provider. The service provided (worth 6,5 USD) was satisfactory and there was no financial loss.
Case 3) Theft of plastic sheets
In October, plastic sheets worth USD 2,900 were stolen. The perpetrator was a staff member who managed to escape with the sheets. NRC filed charges with local police.