During 2020, a total of 92 cases of alleged financial corruption/misconduct were investigated. All cases were detected because of NRC’s internal control measures or through whistleblowing. Affected donors have been informed and where money has been lost, NRC has sought to recover the amount or cover it. Proper prevention measures were applied accordingly, and appropriate disciplinary action taken in line with NRC policy and local law.
Out of the investigated cases, 56 cases were found to be either groundless, not substantiated or related to negligence and bad performance. 5 cases were avoided due to early detection, and 7 cases are pending conclusion.
Concluded corruption cases from 2020
In the cases presented below, it was concluded that corruption/financial irregularities had taken place:
Fraud – 00005084
In January, internal control detected that a community-based worker had altered medical invoices. The loss was recovered from the salary.
Bribery/kickback – 00005467
In October, NRC was informed that a staff had shared internal information which helped a supplier win contracts. The investigation concluded that it was highly likely that the suspect had received kickbacks. There was no tangible loss.
Irregularity/fraud – 00005532
In September 2020, internal control discovered that procurement procedures had been bypassed by the procurement committee to favour a rental vehicle supplier. The total rental vehicle expenses charged were 4,856 USD. However, due to the limited number of suppliers based in the area, NRC was unable to conduct a market survey to determine the actual loss related to potential bid rigging.
Bid rigging and supplier collusion – 00005565
In September, NRC received an anonymous complaint about staff sharing procurement information with a supplier to help him win multiple bids. The investigation found it highly likely that suppliers had colluded but was not able to gather sufficient evidence to prove or disprove whether NRC staff was involved. No identifiable loss was discovered.
Conflict of interest – 00005574
In September it was discovered that an NRC staff had an undeclared conflict of interest with a supplier. There was no tangible loss.
Alleged construction fraud – 00005520
A Physical verification of security gates in October, suggested that the gates had been constructed very poorly and did not meet the minimum-security standards. Irregularities upon construction were confirmed upon further investigation. There was no tangible loss.
Conflict of interest – 00005268
NRC received a complaint mid-April 2020 from a former supplier about a staff member having requested commissions for awarding contracts. The investigation revealed an unhealthy relationship between the staff member and the supplier, which could amount to an undeclared conflict of interest but did not prove the allegations. No financial loss was detected.
Identity theft – 00005715
In October, several cases were reported where an unknown person has been falsely acting on behalf of NRC’s identity, asking potential beneficiaries for 1 USD to register on distribution lists. The case was reported to the Police who followed-up. NRC has done a communication campaign through NRC social media and among beneficiaries emphasizing the fact that NRC assistance is free.
Fraud – 00005741
In November it was detected that a beneficiary had impersonated another beneficiary and signed for their cash disbursement of 330 USD. The case was reported to the Police who followed-up.
Fraud – 00005543
At the end of July, internal control revealed that one of two NRC staff who had chartered a private plane to be able to conduct programme activities brought along family and a companion without seeking permission. The staff reimbursed costs for the unauthorised passenger and NRC is following up with the airline company.
Fraud – 00005441
NRC was informed in July that an implementing partner violated the policy by charging beneficiaries USD 5 to be included on the distribution list. The case has been reported to local authorities who are following up.
Bribery/kickback – 00005433
In June, NRC was alerted that an NRC staff member had an agreement with the landlord of a staff accommodation in an area office. During the investigation, the NRC staff member admitted demanding kickbacks from the landlord
Attempted aid diversion – 00005585
In October, an NRC Supervisor caught 3 daily workers trying to manipulate the distribution list, the changes were corrected, and no loss occurred.
Fraud – 00005427
In August, internal controls identified widespread suspicious medical claims. A detailed analysis revealed that reported medical expenses were above the expected average for some specific periods and areas. An external investigation identified 15,000 USD medical claims fraud of which a substantial amount was recovered. The final loss was estimated at USD 1421.
Fraud – 00005461
In July, internal controls found that payments to incentive workers appeared suspicious. An external consultant was contracted and confirmed that some workers did not exist and that several NRC staff had colluded, forged signatures and documentation, with an estimated financial loss of USD 57 850.
Gas fuel supply fraud – 00005181
In January, while delivering fuel, a supplier provided 378 litres less than the ordered 3000 litres. The supplier suggested to the staff receiving the fuel to manipulate the fuel meter to 3000 litres. While the staff refused the offer and reported it to his line manager immediately, the result was an overall loss of 378 litres with the estimated value of USD 250.
Expense claim fraud – 00005091
In February, internal control revealed blank expense receipts with beneficiaries’ fingerprints in 5 active cases managed by a staff. An investigation found evidence that the staff has been asking beneficiaries to pre-sign blank receipts with their fingerprints and then back dating expense claims. There is also some evidence that those claims have been inflated. The estimated loss is 90-100 USD.
Electricity theft – 00005422
In July, illegal electrical connections to an NRC generator were detected after receiving complaints of constant electricity cuts by staff living in the compound. A guard had managed to connect his home to the generator resulting in an estimated loss of USD 3,000.
Small grants fraud – 00005558
In September, during a distribution to Micro Grants beneficiaries, as staff reported that beneficiaries who attended the distribution to collect the awarded grant seemed familiar with the staff members present. NRC immediately informed beneficiaries to not spend the money until further notice and to recover the money. While 28 out of total 35 beneficiaries showed up, NRC only managed to collect 40,700,000 IQD out of the total distribution of 201,175,000 IQD. The Investigation found that only 1 out of the 35 beneficiaries was eligible to receive the grant based on pre-established eligibility criteria, and support to the allegations of staff nepotism, involvement in unethical activities, misuse of funds and compromising NRC image through favouring relatives. The estimated amount affected is USD 129,979
Theft/fraud – 00005718
In October, a Whistle-blower reported irregularities in a caravan rehabilitation project. Spot checks were conducted to verify the difference between issued and used materials for caravan repairs and discrepancies were found. The accused volunteer working on the site did not admit theft but was not able to explain the discrepancy. The investigation concluded there was sufficient evidence to support the allegation and an estimated loss of USD 935.
Aid diversion – 00005650
In mid-October, a community member reported that an NRC staff influenced the beneficiary selection process. An investigation revealed that the NRC staff member did manipulate the distribution list to include friends and family, and that a worker at the bank colluded to ensure the cash payments were made. The estimated loss was USD 869.
Extorsion by implementing partner – 00005186
In March, an NRC staff detected alleged extorsion during a beneficiary satisfaction spot check of the services provided by the NRC implementing partner (IP). Four beneficiaries reported paying money for the services provided by the IP while the cost had been 100% covered by NRC. An investigation revealed that 7 out of 18 beneficiaries had paid between USD 8.5 – 42.6. The IP explained that they had suffered from lack of funding and therefore collected the amounts as community contribution, but not for the services provided under NRC’s project. However, this had not been clear to the beneficiaries, nor been shared with NRC.
Product substitution/theft – 00005088
A Whistleblowing email was received by NRC in mid-February alleging that food deliveries to schools had suffered from under delivery and product substitution. The investigation concluded that a supplier had provided substandard food to schools and under delivered goods at a total of USD 3 554.
Fraud/bribe – 00005487
In August, multiple complaints were discovered reported through the NRC Complaints and Feedback mechanism relating to possible corruption during tent distributions in various locations in a camp (beneficiaries being requested to pay for assistance). The investigation found no evidence of committed misconduct by NRC staff. It did however find evidence supporting corruption external to NRC. The case was addressed by local authorities and money returned to beneficiaries.
Theft of stationary – 00005776
In December, a Whistle-blower reported alleged theft of small stationary (e.g. some pencils, white board markers, a few scissors) from a classroom. A quick investigation found that there was legitimate concern of committed misconduct by a facilitator working on the site.
Attempted fraud – 00005240
In April, internal control found that 15 employees possibly abused an NRC kindergarten support system. The investigation concluded that staff had claimed higher amounts than the actual day care fees or for day care they had not used by forging invoices and stamps, and NRC was able to stop the refunds. No financial loss was involved.
Fraud – 00005663
During post distribution monitoring in early November, a beneficiary reported that she had not received her cash card, a system check found that 54 USD had been withdrawn and that the signature on the distribution list was faked. It is suspected that a genuine beneficiary signed for 2 cards, but no evidence was found to prove the case.
Attempted bribery/kickback – 00005705
In November, an NRC staff received a WhatsApp message where a supplier offered NRC staff bribes to select them for the vehicle rentals. The attempt was detected and reported internally. There was no financial loss involved.
Attempted product substitution – 00005395
In February, a supplier provided laptops at a significantly lower quality/specification than what was ordered and paid for. NRC refused the delivery and requested the correct laptops, but they were not delivered. Through legal support, NRC was able to get the funds reimbursed and another process was launched to procure them.