Fraud Prevention

Policy

Policy Owner

Financial Services

Record no.

22/299197

Approved by:

EMT

Approval date:

9 February 2022

Endorsed by:

Audit and Risk Committee Date endorsed:

27 May 2022

Adopted by:

Council

Adoption date:

23 June 2022

Version

Last review date:

Adopted 10/12/2019

Next review date: December 2023

Prepared by

Riana Brims, Strategic Risk and Assurance Officer

Related document/s

Fraud and Corruption Control Framework; Fraud Reporting and Investigation

Procedure; Public Interest Disclosures Policy; Public Interest Disclosures

Procedure.

Fraud Prevention Policy

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1. Purpose

Brimbank City Council (Council) is committed to protecting its revenue, expenditure,

property and intellectual capital from any attempt, either by Council officers, Councillors,

members of the public, providers or volunteers, to gain any financial or personal

advantage by deception. An incident of fraud and corrupt conduct has the potential to

adversely impact the Council including financial impact, material breach of legislation or

regulation and reputation.

Council’s Fraud Prevention Policy (Policy) describes Council’s commitment to managing

fraud and corruption risk and to meeting its legislative obligations under the

Local

Government Act 2020

including: ensuring that resources are maintained in a responsible

and accountable manner.

Council’s commitment to fraud and corruption control is met by ensuring a culture of

which fraudulent or corrupt conduct is not tolerated. The Policy applies to all Council

officers, Councillors, providers and volunteers of Council, who must act with integrity at

all times and never engage in fraud and corruption.

Councillors are also obliged to maintain integrity standards as mandated by the

Local

Government Act 1920.

The Policy is communicated across the organisation through pages on Council’s Intranet

and website, department presentations and team meetings, and via the content of

mandatory e-learning modules.

The Policy is consistent with:



AS ISO 31000:2018 Risk Management – Guidelines



AS 8001:2021 – Fraud and Corruption Control



Brimbank City Council Risk Management Framework



Brimbank City Council Risk Management Policy.

2. Policy Statement

Council has a strong commitment to maintaining the highest ethical standards. Council is

committed to:



actively deterring and preventing corrupt and fraudulent conduct.



Creating a culture and systems that are conducive to detection and reporting of

fraudulent and corrupt conduct.



managing instances of fraudulent and corrupt conduct with a zero tolerance

approach.



continuous monitoring of fraud and corruption risk and continual improvement

controls.



respecting the rights of individuals, a commitment to natural justice and

procedural fairness, and protection of disclosers and sources.



Fairly treating and affording natural justice and procedural fairness to any Council

officer, Councillor, or provider suspected of fraud or misconduct, should an

investigation be necessary.

Fraud Prevention Policy

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In order to meet this commitment, any evidence of fraudulent or corrupt

conduct must be brought to the attention of management in accordance with section 6

below and Council’s Fraud Reporting and Investigation Procedure.

Council requires all Council officers, Councillors, providers, and volunteers to make

themselves aware of the Council’s Codes of Conduct and all other related policies that

support this commitment.

3. Integrity Framework

In addition to this Policy, Council has developed a:



Fraud and Corruption Control Framework (FCCF) describing Council’s fraud

management approach



Fraud Reporting and Investigation Procedure (FRIP) to guide Council officers in

the process for reporting and conducting an internal investigation when an

incident of suspected fraud or corruption is detected.



Public Interest Disclosures Policy (PID Policy) establishing Council’s commitment

to maintaining its integrity, supporting anyone disclosing information about

improper conduct or detrimental action, and ensuring its compliance with the Act.



Public Interest Disclosures Procedure (PID Procedure) setting out how Council will

encourage and facilitate the making of disclosures, provide protecting and

support for disclosers and witnesses, and ensure confidentiality and appropriate

reporting of disclosures.

This Policy is complementary to and is to be read in conjunction with the above suite of

documents, and is intrinsically linked to Council’s other key ethical guidance policies and

procedures as outlined in the diagram below.

4. Fraud and corruption risk management

This Policy must also be read in conjunction with Council’s Public Interest Disclosures Policy and Public Interest

Disclosures Procedure, which provides the reporting process required in accordance with the Public Interest

Disclosures Act 2012.

Fraud Prevention Policy

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

Council has determined a little-to-no risk appetite for fraud and corruption

and is committed to avoiding risk and uncertainly in this space.



Council will maintain a strategic risk register including key risks in the external and

internal operating environment that could materially impact the delivery of the

Council Plan.



A summary of strategic risks, controls and improvement actions will at a minimum:

o

be considered annually by the Audit and Risk Committee as part of

development of the Strategic Internal Audit Plan

o

be considered by the Executive Management Team and the Audit and Risk

Committee on a quarterly basis.



Any material changes in strategic risk will be reported to the Executive Management

Team and Audit and Risk Committee as soon as practicable.



Council will maintain an operational risk register including key risks identified by

each department in the internal operating environment. (Managers are accountable

for the management of operational risks within their respective departments).

5. Roles, responsibilities and accountabilities

In order for Council’s fraud risk management practices to be effective, all Council

officers, Councillors, providers, and volunteers must comply with the Policy, and

Council’s broader risk management principles in their day to day activities, and are

responsible for managing risks in their areas.

The AS 8001:2021 Fraud and Corruption Control Standard emphasises the role of the

‘Governing Body’ and ‘Top Management’ and that they are accountable for ensuring the

organisation has adequate anti-fraud and anti-corruption measures in place, and that

there is an adequate understanding of roles in managing fraud and corruption exposures

and controls.

Roles, responsibilities and accountabilities for risk management

Personnel

Accountabilities and responsibilities

Council



Reviews and adopts the Policy and applies risk management principles

to the decision making process

Chief Executive Officer

(Principal Officer)



Promotes a strong risk management culture



Ensures a policy is in operation



Ensures adequate organisational structure and resourcing for fraud risk

management



Notifies Independent Broad-based Anti-corruption Commission (IBAC)

of suspected matters of corrupt conduct



Reports confirmed incidents of fraud or corruption to the Audit and Risk

Committee (excluding public interest disclosures).

Audit and Risk Committee



Monitors implementation of effective risk and opportunity management

controls and the effectiveness of the RMF through regular reviews and

reporting



Regularly reviews the strategic risk register and oversees that extreme

and high level risks are being managed in accordance with the Risk

Management Framework (RMF).



Monitors fraud risk at strategic level.

Fraud Prevention Policy

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Internal Audit



Periodically audits Council’s risk management practices and provides

recommendations for improvement including findings of fraud or

corrupt conduct.

Executive Management

Team



Approves, commits to, and promotes the Policy, Risk Management

Policy and RMF.



Monitors Council’s overall risk profile and mitigation strategies



Ensures risk management is embedded into all critical functions and

activities



Empowers staff to actively participate in managing risk and to

encourage a proactive risk culture



Reviews strategic risks quarterly prior to each Audit and Risk Committee

meeting or as otherwise may be provided as part of other reporting



Ensures fraud risks are identified within respective directorates



Ensures effective fraud control measures are in place.

Managers and Coordinators



Commits to, and promotes the Policy, Risk Management Policy and RMF

ensuring risk management is embedded into all critical functions and

activities



Identifies fraud risks and implements fraud and corruption prevention

controls



Ensures public interest disclosures are handled in accordance with

Council’s Public Interest Disclosures Policy and Procedure



Ensures ongoing and regular reviews of risk registers including the

actioning of any overdue risk treatments



Empowers staff to actively be involved in managing risk, and promotes a

proactive risk culture.

Fraud Control Officer

(Manager Finance)



Ensures the Fraud and Corruption Control Framework is implemented



Maintains a register of fraud and corruption incidents



Ensures fraud awareness training is conducted (jointly with Manager

People and Performance)

Public Interest Disclosures

Coordinator (Manager

Governance)



Ensures the Public Interest Disclosures Policy and Procedure are

complied with when handling public interest disclosures.



When informed of an instance of suspected fraud or corruption is

required to assess the information and determine if it is an assessable

disclosure in accordance with the PID Act, and Council's PID Policy and

PID Procedure.

Public Interest Disclosures

Officers (and Coordinator)



Handles reports of fraud or corruption by a discloser

All staff, Councillors,

providers and volunteers



Understands the risk management processes that are integrated into all

Council activities



Identifies, evaluates, reports and manages risks in daily activities and

projects



Carries out their duties in an honest and open manner, ensuring that

they can withstand the highest level of public scrutiny and that all

statutory requirements are met



Acts in an ethical way at all times and never compromising the integrity

of Council or acting in a way that can bring Council, or themselves into

disrepute.



Reports suspected fraud or corruption to their supervisor.

Full detail of roles, responsibilities and accountabilities for risk management at Council

are specified in the RMF, Audit and Risk Committee Charter, and individual employee

position descriptions.

Fraud Prevention Policy

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6. Overview of Fraud Reporting and Investigation Procedures

6.1 Investigations

Council will implement procedures to facilitate investigations of allegations of fraudulent

and corrupt conduct. Subject to the requirements of the

Public Interest Disclosures Act

2012

(PID Act) and the

Independent Broad-based Anti-corruption Commission Act 2011

(IBAC Act), all reports of fraud and corruption, will be assessed and, if appropriate,

investigated, in accordance with Council’s Fraud Reporting and Investigation Procedure.

All reports that are assessable public interest disclosures will be referred by the Public

Interest Disclosures Coordinator to the Independent Broad-based Anti-corruption

Commission for final assessment and, if appropriate, subsequent investigation.

Confidentiality will be maintained and protection is afforded under the PID Act if the

report is determined to be a public interest disclosure.

Where any allegation of fraud or corruption is substantiated, Council will respond by

reporting the incident to relevant authorities and by undertaking disciplinary action under

Council’s Codes of Conduct. Council will seek financial recovery of losses in all cases and

civil proceedings may be initiated.

6.2 Reporting

Councillors

Councillors are obligated to report all suspected incidents of fraud or misconduct. For

detailed guidance, Councillors are directed to the Councillor Code of Conduct and other

relevant policies.

Councillors will report all suspected fraud or misconduct to the Chief Executive Officer, a

Director or the Public Interest Disclosures Coordinator, except where it relates to a

Councillor. If the matter relates to a Councillor, then a Councillor should follow the

relevant provisions of the Councillor Code of Conduct, or if the report is a public interest

disclosure matter, report the matter directly to the IBAC or Victorian Ombudsman.

Employees

Council officers are obligated to report all suspected incidents of fraud or misconduct.

The Employee Code of Conduct details Council’s expectation of the conduct of all Council

officers. For guidance, Council officers are directed to the Employee Code of Conduct and

other related policies.

Council officers will report to their Supervisor, Manager, Director, Chief Executive Officer,

Public Interest Disclosures Coordinator or Fraud Control Officer, Public Interest

Disclosures Officer, or to the IBAC.

Principal Officer

In the absence of a complaint being about the Chief Executive Officer, the Chief

Executive Officer as the Principal Officer will report any suspected fraud or corrupt

conduct to IBAC in accordance with mandatory reporting obligations set out in s.57 of the

IBAC Act (using the mandatory notification form). The Chief Executive Officer will report

Fraud Prevention Policy

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confirmed incidences of fraud, or misconduct to the Audit and Risk Committee

(that are not public interest disclosures).

7. Fraud and corruption performance indicators

Fraud and corruption management is integrated within Council’s enterprise RMF. The

below performance indicators have therefore been established to assess and evaluate the

risks associated with fraud and corruption.



Fraud and Corruption Control Framework reviewed and updated every two years.



Fraud control self assessments completed by 100% of targeted departments.



Total number of fraud incidents recorded over a two year period [<3].



Total cost of fraud incidents recorded over a two year period [<0.5% revenue].

8. Continuous improvement

Every two years Council conducts a Fraud Awareness Program (Program) to improve

awareness and transparency, and to strengthen Council’s fraud and corruption risk

management culture. Key components of the Program include:



Review of the Policy, FCCF, FRIP, PID Policy and PID Procedure



Strategic and operational fraud and corruption risk reviews



Department fraud control self-assessments



Fraud and corruption awareness team discussions and online training modules



Fraud awareness and PID information packs/brochures.

Outcomes of the Program are reported to the Executive Management Team and the Audit

and Risk Committee. Updates to key policies are presented to Council for adoption

considering any recommendations of the Audit and Risk Committee.

In addition, Council will publicise and raise awareness of relevant codes of conduct to

ensure employees, providers and volunteers are aware of their responsibility and role in

minimising the risk of fraud and corruption.

Fraud Prevention Policy

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9. Definitions and key terms used in this Policy

Corruption:

dishonest activity in which a person associated with

an organisation (e.g. director, executive, manager,

employee or contractor) acts contrary to the

interests of the organisation and abuses their

position of trust in order to achieve personal

advantage or advantage for another person or

organization. This can also involve corrupt conduct

by the organisation, or a person purporting to act on

behalf of and in the interests of the organisation, in

order to secure some form of improper advantage for

the organization either directly or indirectly.

Fraud:

Dishonest activity causing actual or potential loss or

loss to any person or organisation including theft of

moneys or other property by persons internal and/or

external to the organization and/or where deception

is used at the time, immediately before or

immediately following the activity

Natural justice:

A principle of Common Law that says a person has

the right to be:

•

informed about the substance or the allegations

against them

•

given the opportunity to answer the allegations

before a final decision is made

•

informed about the substance of any adverse

comment that may be included in an investigation

report and have their defence fairly included in the

report

Public interest disclosure:

Any complaint, concern, matter, allegation or

disclosure (however described) purported to be made

in accordance with Part 2 of the PID Act. A public

interest disclosure is one which is made by a natural

person or group of people who has reasonable

grounds for the belief that a public officer or public

body has engaged in, or intends to engage in

improper conduct in their official capacity, or

detrimental action

Fraud Prevention Policy

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Local Government Act 2020

Compliance Statement

Section 9(1) of the

Local Government Act 2020

(Act)

requires Council to give effect to

the overarching governance principles, in the performance of its role. Section 9(2) of the

Act specifies the governance principles as follows:

a) Council decisions are to be made and actions taken in accordance with the

relevant law

(Compliance with the law)

;

b) Priority is to be given to achieving the best outcomes for the municipal

community, including future generations

(Achieve best outcomes for the

community)

;

c) The economic, social and environmental sustainability of the municipal district,

including mitigation and planning for climate change risks, is to be promoted

(Promote the sustainability of the municipality)

;

d) The municipal community is to be engaged in strategic planning and strategic

decision making

(Engage the community in strategic planning and decision

making)

;

e) Innovation and continuous improvement is to be pursued

(Strive for innovation

and continuous improvement)

;

f) Collaboration with other Councils and Governments and statutory bodies is to be

sought

(Collaborate with all other levels of government and government

agencies)

;

g) The ongoing financial viability of the Council is to be ensured

(Secure the

ongoing financial viability of Council)

;

h) Regional, state and national plans and policies are to be taken into to account in

strategic planning and decision making

(Strategic planning and decision

making must take into account plans and policies in operation at all

levels)

;

i) The transparency of Council decisions, actions and information is to be ensured

(Council decisions, actions and information must be transparent).

Fraud Prevention Policy

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In reviewing the Fraud Prevention Policy, Council has considered and given effect to the

overarching governance principles, as summarised below:

Governance Principle

Considerations

(a) Compliance with the law



Local Government Act 2020



Independent Broad-based Anti-corruption Commission

Act 2011



Public Interest Disclosures Act 2012

(b) Achieve best outcomes for the

community

The Policy enables fraud and corruption risks to be

identified and managed appropriately to ensure strategic

objectives are met and best outcomes for the community

are achieved.

the municipality

Economic, social and environmental sustainability was

considered in developing the Policy that provides Council’s

commitment to ongoing monitoring of fraud and corruption

risks.

(d) Engage the community in

strategic planning and

decision making

Not applicable for the Policy.

(e) Strive for innovation and

continuous improvement

Council will review the Policy on a no less than biennial

basis, and pursue innovation and continuous improvement

during every review.

(f) Collaborate with all other

levels of government and

government agencies

Not applicable for the Policy.

(g) Secure the ongoing financial

viability of Council

The Policy:



is designed to create and protect value by targeting

effort and resources to areas of highest priority;



supports Council’s commitment to its financial

responsibility for effectively managing risks and

opportunities in all areas of operations;



supports the protection of Council assets and finances;



promotes efficient and ethical use of resources and

services.

(h) Strategic planning and

decision making must take

into account plans and policies

in operation at all levels

Not applicable for the Policy.

Fraud Prevention Policy

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(i) Council decisions, actions and

information must be

transparent

This Policy supports the principle of transparency and

promotes integrity in Council decisions, actions and

information.