During 2021, a total of 222 allegations of corruption were received. Following triage, 48 cases of alleged financial corruption/misconduct were found to have been substantiated, see below. 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.
The remaining 174 reports were either categorized as non-financial corruption/misconduct, groundless, not substantiated, malicious, or referred to other parts of the organization for rectification, for example allegation related to behaviour or poor performance and was referred to HR.
Concluded corruption cases from 2021
In the cases presented below, it was concluded that corruption/financial irregularities had taken place:
- Selection of Ineligible Beneficiaries and Supplier - 00006630
An NRC staff member reported that their line manager forcefully introduced 9 beneficiaries to be selected for assistance for a livelihoods program. A needs assessment was completed which showed that there were only three beneficiaries out of those nine that were eligible. The ineligible beneficiaries received an equivalent of 615.00 USD worth of training.
- Red flags in large procurement for winterization - 00006553
A senior staff member along with the Compliance Team raised concerns of red flags in a major procurement for a winterization procurement ongoing in NRC Afghanistan. An initial review indicated that the procurement process appeared to have been manipulated favoring a specific supplier. The investigation further found that there was evidence of potential price inflation and product substitution. Enhanced goods receiving procedures were immediately adopted which resulted in multiple items being returned to the supplier, who rectified the issue and sent the correct goods. A market survey found that the prices had not been inflated. There was no financial loss.
- Corruption - 00006755
Two companies accused a former NRC staff member of demanding money to demonstrate their financial standing to be able to bid for NRC procurements. The allegation was substantiated, and the staff member left NRC during the investigation. No financial loss to the organization has been found.
- Nepotism – 00005974
A Whistleblower reported concerns regarding a procurement process involving vehicle rental, in which there was an undeclared conflict of interest with a bids committee member. It was proven that there was an undeclared conflict of interest. NRC followed a disciplinary process for the implicated staff.
- Product Substitution – 00006269
During a routine field visit, it was discovered that a staff member signed a Goods Received Note for one type of product, but a different type of product was delivered. Fact finding revealed that the supplier was acting on instructions from a staff member based on the local communities’ preferences. The difference in cost between the two types of material was 500.00 USD in total. NRC will work to recover this amount from the supplier. There was no evidence found of ill intent.
CENTRAL AFRICAN REPUBLIC
- Aid diversion/theft – 00005975
An external source reported an allegation of an NRC staff member diverting kits during distributions. Following an investigation NRC found that community leaders received kits even though they were not eligible, that there were irregularities in the distribution lists, and that there was theft of kits. In total, the investigation demonstrated the loss to be 11,718.98 USD, which has been reimbursed to donors.
- Kit fraud – 00006206
In June 2021, anomalies during the distribution of education kits were reported to NRC. The investigation revealed theft of items from a staff member, that there was a discrepancy between what was withdrawn from the warehouse and what was delivered, that there was a non-eligible salary payment, and that there were two kits distributed without proper documentation. The total loss reported to the donor was $1,294 USD.
- Theft of vehicle parts – 00006278
NRC held an auction of old vehicles. Once the auction was complete and the winning bidders came to collect the items, it was noticed that certain parts were missing. The investigation was not able to conclusively prove that staff were involved in theft. Most of the cars were owned by NRC and the total amount believed to have been lost is negligible given the depreciation since the purchase of the cars 8-10 years earlier.
- Theft – 00006328
A contracted guard proposed to an NRC staff to jointly steal an empty bottle of gas, worth $24.50 USD. The staff reported the incident and NRC was able to thwart the act. There was no financial loss.
- Procurement Fraud – 00006528 & 00006529
In September 2021, through routine control checks, NRC found two instances of payments being made for the delivery of one set of items. The person suspected of having initiated these processes was no longer working for NRC. These amounted to 11,103.00 USD and 923.00 USD respectively and have been reimbursed to the donor.
- Procurement Fraud – 00006530
In September 2021, through a routine control check, it was noticed that there were similarities in quotations provided by different suppliers. On the balance of probabilities, it is believed that one supplier provided three quotations to secure the contract. However, NRC followed all logistics procedures, received the goods, and the prices paid were in line with similar purchases. There was no financial loss.
- Alleged favoritism - 00006465
Through verifications from the Complaints and Feedback Mechanism (CFM) it was reported that a tutor replaced beneficiaries without authorization in a CASH program. Although the investigation confirmed that favoritism had not occurred, the investigation concluded that the tutor did not follow the established procedures. There was a financial loss of 130.98 USD.
- Deception by Contractor - 00006466
Community members contacted NRC and claimed that they had been deceived by a contractor for some labor and materials. The investigation concluded that the contractor had asked beneficiaries to sign for materials and completed projects that had not been delivered or the projects not completed. The contractor explained to the beneficiaries that if they did not sign, then he would not get paid and would be unable to complete the deliveries and projects. The beneficiaries signed, but the contractor did not finish the project and NRC had to invest additional funds to complete the project, resulting in a financial loss of 17,482.00 USD.
DEMOCRATIC REPUBLIC OF CONGO
- Procurement Fraud, Bribery / kickbacks – 00006043
An internal control process detected potential favouritism in the procurement of a construction contract. The staff member concerned admitted to accepting small gifts from the supplier, without declaring them, but denied any favouritism. A disciplinary process was carried out.
- Multiple Allegations – 00006081 & 00006576
Whistleblowers brought forth several allegations pertaining to one area office. NRC sent an external investigator to support the investigation. There was a case of Conflict of Interest and theft found in relation to the provision of kits to partner organizations (cost not identified). There was also a proven case of NRC being overcharged for programme supplies, at a value of 4,368.00 USD, though the final payment had not been made to the supplier, so NRC was able to recover this cost. Finally, a case of 4 ghost suppliers was found. These suppliers were used between 2019 and 2021. NRC completed a market assessment. There was a difference of 2,425.00 USD. However, it should be noted that this difference could also be due to the time lapse between the purchases and the completion of the marker survey, as well as the volatility of the market, and as such it was difficult to determine if there had been a financial loss. It is also important that the goods were received as ordered by NRC and used for their intended purposes, meaning that there was no impact on the communities.
- Bribery / Extortion – 00006281
NRC received a report stating that an NRC staff extorted money from the driver of a car rental agency (5 USD) for every night they spent on mission. The accused staff member denied the allegation; however, it was established that the driver had sent 10.00 USD to the NRC staff, who never returned the money, reported, or declared it as a gift until the investigation. Disciplinary actions were taken against the staff for breach of Code of Conduct.
- Theft – 00006636
In November 2021, an NRC vehicle convoy was attacked by community members during a violent outpouring after the death of a community member. During the attack one bag was stolen, which was later returned, with all its contents. Another staff member then reported their bag being stolen as well, which included a cash advance of 4,600.00 USD. The amount was lost.
- Theft – 00006637
In November 2021, NRC became aware of theft of several items from a warehouse. Most of the items were low-value items, used in NRC guest houses. NRC completed a preliminary investigation but was unable to find any substantial leads to undertake a full investigation. There was a small loss to NRC.
- Alleged Ghost Beneficiaries - 00006068
Allegations were received from beneficiaries of a training program that was being conducted by a local partner. They alleged that they were requested to attend classes only on the day NRC staff were conducting field visits. The students informed NRC staff that they had not attended the full training. The investigator was denied access to the students, and the result is inconclusive.
- Mobile Scratch Cards Theft - 00006388
350 scratch cards were reported missing from an NRC office in two separate incidents from two different departments. The estimated value of those cards was 2,775,000 IQD, or 1,900.00 USD. Although the investigation identified a suspect, there was not enough evidence to proceed to disciplinary.
- Exchanging Scratch Cards with cards holding less value - 00006525
Internet scratch cards, valued at 15,000 IQD, or 10.00 USD each were supposed to be distributed to incentive workers in two rounds. For round 1, 10 internet scratch cards were distributed to 10 incentive workers. While for the second round, the incentive workers confirmed that they received mobile scratch cards with a value of 5,000 IQD, 3.00 USD each. This caused a difference estimated with 21,250 IQD, 14.00 USD.
- Blackmail/Extortion - 00005795
NRC received a complaint that a staff member had contacted beneficiaries requesting a payment of 1.750.000 IQD, 1.20 USD before being entitled to the second instalment for a business grant. The suspect claimed that there was a conflict between him and some beneficiaries. The suspect supported his version of events with missed call logs. The investigation could not conclusively substantiate the allegation.
- Procurement Fraud - 00005911
A routine review of procurement files found that one company consistently presented quotations that were just below the Purchase Request value. An investigation commenced and the allegation was substantiated. It was also clear that a particular staff member was involved in each procurement. The staff contract was not renewed.
- Shelter Beneficiary Fraud - 00006090
A routine review of a shelter program found that two properties whose owners had received shelter cash assistance had not undertaken any work on their properties. An investigation was undertaken to identify if any NRC staff had been involved. The investigation found that no NRC staff had benefitted or were aware of this. The amount paid to the two property owners was 6,046.00 USD.
- Cheque book fraud - 00006307
Allegation was received by a partner staff member that her signature had been forged on cheques. Despite a robust investigation not enough evidence could be found to prove or disprove the allegation.
- Bribery / Extortion – 00005897
In February 2021, a supplier who was not awarded a contract following a tender process, reported that there was misconduct within the procurement process. The supplier added that he paid staff 1300.00 USD for the contract to be awarded to him. This allegation was substantiated and two staff confessed to having collected bribes from the supplier. Disciplinary actions were carried out.
- Allegation of Fraudulent Alerts and Theft – 00006209
NRC received an allegation of potential aid diversion by means of issuance of false population movement alerts, which would trigger a distribution being generated and kits being stolen. NRC completed an investigation but could not prove or disprove the allegation.
- Theft of NRC assets and goods – 00006657
Two staff members were caught stealing NRC assets and goods. NRC followed its disciplinary procedure and was able to recover all the items.
- Extortion - 00006727
It was reported by daily workers that a middle manager in NRC was demanding money in return for employing them on a daily basis (approximately 10.30 USD per worker per month). Multiple interviews confirmed the situation and that a small number of workers had been excluded from future work for refusing to pay. The manager left NRC as the investigation started and due to security concerns was not contacted as part of the investigative process
- Tender Fraud - Longhouses Reconstruction - 00006483
During a tender process for reconstruction of 21 houses an allegation of favouritism was received. The investigation could neither prove nor disprove the allegation. A new procurement process was launched with new suppliers and potential loss prevented.
- Conflict of Interest – 00006653
An NRC staff member was accused of having a conflict of interest with suppliers. Based on the evidence obtained, it is reasonable to conclude that there were undisclosed links between the staff member and suppliers. NRC also found evidence of ghost suppliers. A market survey revealed that there was no financial loss involved.
- Conflict of Interest & Ghost Suppliers – 00006654
NRC received an allegation of conflict of interest and ghost suppliers. The investigation found connections between a staff member and suppliers, though the depth of these relationships could not be determined. It was also proven that there were several ghost suppliers. After a market survey it was concluded that there was no financial loss to NRC.
- Aid Diversion by Local Authorities - 00006368
Local authorities informed NRC that a senior civil servant was criminally charged and found guilty of diverting 42,000.00 USD worth of food aid. NRC opened an internal enquiry that confirmed that an NRC staff was involved and had received food on behalf of her relatives (25 individuals/beneficiaries). The staff member was dismissed, referred to local authorities and was found guilty in court.
- Procurement fraud - 00006384
A whistleblower reported that staff were using ghost suppliers to provide quotations. A search of the office found company stamps in the desk of one staff member. A check of procurements found that one of the companies whose stamps were found in the desk had provided services to NRC for an amount of 289.00 USD. The allegation was substantiated, and the staff members were dismissed.
- Theft - 00005776
An allegation was raised that a facilitator was stealing stationery from an NRC camp education center after working hours. The investigation found that there were legitimate concerns of committed misconduct, and a disciplinary process was opened. The loss was 92.75 USD
- Fraud and ineligible beneficiaries - 00005957
An allegation was raised against an NRC partner accusing their staff of accepting a fake distribution list. NRC carried out an investigation in cooperation with the partner and found that 10 households were not eligible for distribution. The loss was 1,430.00 USD
- Possible collusion between suppliers/ Leakage of information - 00006214
A supplier complained that he had the best offer during a procurement process but was not selected. An investigation found that the supplier had the cheapest quotation but was still ranked 2nd. It was suspected that there was leakage of information or collusion between suppliers. NRC decided to cancel the project.
- Theft - 00006213
It was reported that office consumables (tea/coffee/milk) were regularly being stolen. An investigation identified a suspect but was unable to gather sufficient evidence to secure disciplinary action.
- Ineligible Beneficiaries - 00005875
A complaint was received that one of NRC's partners' staff had benefited 130.00 USD from the project due to his wife being listed as a beneficiary. The partner staff member was dismissed.
- Extortion - 00006236
Allegations were raised by a small grant business beneficiary against a local council manager, accusing him of taking over the beneficiaries' grants and selling their project items which cost 1,000.00 USD and then compensating the beneficiaries by returning 200.00 USD to them. 3 beneficiaries confirmed the allegation. NRC had implemented the project correctly and the incident happened after NRC’s involvement had finished. No NRC staff member committed any misconduct.
- Extortion - 00006667
NRC staff were informed that local authorities requested a large amount of money to allow the suppliers and contractors to implement their work. The statements provided confirmed that the local authorities are extorting contractors by asking for “donations”. The matter was passed onto the relevant UN agencies for action.
- Extortion - 00006668
NRC management was informed that the guards in one of its sites were requested to pay the Camp Managers (appointed by the local authority, not NRC staff) an amount of 50.00 USD per month to be hired with NRC. Based on several statements it was confirmed that the local management was requesting the guards to pay money in exchange for keeping their contract. The guards stated that they understood that the money was being paid to the local management as a donation to a local charity fund. The matter was referred to management for resolution.
- Theft and fraud - 00006071
NRC was informed by camp authorities that 200 used iron sheets worth approximately 430.00 USD, had been found in a refugee’s house in the camp. NRC opened an internal investigation and confirmed that 2 staff members had also been involved in the theft. Both staff members were dismissed.
- Medical Claims Fraud - 00006069
A routine compliance check found that some NRC staff had included non-eligible (i.e. not immediate family) members on their medical aid accounts. The investigation established that 16 staff had included non-eligible beneficiaries on their medical insurance files. NRC combined losses were USD 15,206.00 All involved staff members were dismissed including staff who had facilitated the fraud but had not personally benefitted from it.
- Shelter fraud - 00005963
Allegations were received that a contractor was not the first one selected during the tender process and that the Bid Analysis had been altered in favour of the contractor. The contract was valued at 11,200.00 USD The investigation found the allegation to be true. It also found indications that old materials from damaged shelters being re-used, and poor or uncomplete work which had been charged to NRC.
- Bribery - 00005964
A staff member reported that a supplier has been offering bribes to accept lower standards of work and goods The investigation found that the supplier was offering bribes up to and including 2,000.00 USD. The supplier has been blacklisted.
- Bribery - 00006075
2 staff members reported having been approached by a supplier in an ongoing tender, offering a bribe in exchange to win the bid. The investigation found uncontested digital evidence that that the supplier did offer to bribe to 2 NRC staff to facilitate winning the tender. The supplier was excluded from the tender and blacklisted.
- Extortion of beneficiaries - 00006535
NRC received reports that a casual worker was extorting beneficiaries to stay on the distribution list. The investigation found evidence to support the allegations and the casual worker was dismissed.