Fraud

The following extract, from the School's Financial Regulations (section D16), covers the School's policy and procedure to be followed in a case of a suspected fraud:

D16 POLICY AND PROCEDURE TO BE FOLLOWED IN CASE OF A SUSPECTED FRAUD

D16.1 These notes are intended to amplify and/or add to the duties laid upon staff of the School by both the School's Financial Regulations and its Financial Memorandum with the HEFCE.

D16.2 The School's Financial Regulation D1.2 states:

"Whenever any matter arises which appears to involve irregularity in financial, stores or accounting transactions in any area of the School, the Officer responsible shall immediately report the matter to the Director of Finance & Facilities.

The Director of Finance & Facilities shall, when an irregularity appears to involve a criminal act or a disciplinary offence, report the matter to the Secretary & Director of Administration of the School who in turn should report any material matters to the Finance and General Purposes Committee."

It is the School's policy to prosecute where sufficient evidence of a fraud is available to elicit the support of the Crown Prosecution Service.

The Audit Code of Practice, which flows from the HEFCE Financial Memorandum, contains a mandatory requirement that any significant fraud must be reported to the HEFCE Accounting Officer.

D16.3 In the event of a fraud being suspected, the member of staff discovering the fraud must inform the Director of Finance & Facilities: failure to do so will be regarded as a serious breach of terms of employment. The Director of Finance & Facilities will instigate an appropriate initial response which may include any or all of the following (without this list being construed as exhaustive):

Initiate action to mitigate the potential loss to the School and to inform the School's insurers.
Inform the Secretary & Director of Administration, the Director and the Internal Auditor. The Chairman of the Audit Committee, the Chairman of the Finance and General Purposes Committee, and the Chairman of the Council might also be contacted if appropriate
Agree with the Secretary & Director of Administration and the Director the form and extent of an investigation, which would normally be undertaken by the Internal Auditor.

NOTE: In the event of a suspected fraud involving the Finance Division and/or its staff, the Secretary & Director of Administration will initiate action, and the Director of Finance & Facilities will not be involved in the subsequent investigations unless specifically requested by the Secretary & Director of Administration and the Director.

D16.4 In the event of a request from the Director of Finance & Facilities, Secretary or Internal Auditor to undertake action to mitigate the potential loss, it is the duty of all staff to co-operate with speed and to observe reasonable expectations of confidentiality (based upon the fact that an allegation may prove to be unfounded).

D16.5 During an investigation, the Director may, at his/her discretion, take action against any members of staff potentially implicated in the suspected fraud pending the results of the investigation eg:

Temporary suspension from duty
Denying access to the School and its facilities

Such action is to be interpreted as assisting the investigation, and not as any assumption of guilt.

D16.6 It is the duty of the Director of Finance & Facilities, the Secretary & Director of Administration and the Internal Auditor to conduct any investigation with due alacrity (while observing the principles of natural justice), and to preserve confidentiality wherever this can be reconciled with the best interests of the School.

D16.7 In the event that an allegation is deemed to be substantiated, the action taken (or proposed to be taken) by the Director as a consequence will be recorded in writing. Such action should be proportionate to the allegation but may include (after appropriate consultation with senior colleagues):

Temporary suspension from duty
Denying access to the School and its facilities
Summary dismissal or dismissal under notice
Notification to police
Notification to other parties likely to be affected
Restitution by the perpetrator
Other disciplinary procedures
(It is not intended that this list shall be construed as exhaustive).

D16.8 Under normal circumstances, all reports of fraud will be reported to the next scheduled meeting of the Audit Committee. In instances of sufficient importance, the Director of Finance & Facilities or the Secretary & Director of Administration, in concert with the Chairman of Audit Committee, shall convene an extraordinary meeting of Audit Committee to consider action already taken, or proposed to be taken. In such instances, the Director will normally attend. The form of report to be made to Audit Committee will normally be written, but in the event that it is not it will be recorded in the written form in due course.

D16.9 The Director of Finance & Facilities and the Secretary & Director of Administration shall report all instances of suspected fraud and the outcome of investigations to the Finance and General Purposes Committee on an annual basis. Where there is a material financial impact or risk, the event will be reported at the first available Finance and General Purposes Committee.