Controlling fraud in the public sector - PricewaterhouseCoopers

Conclusion
Our statistics indicate that the public sector
is trailing the private sector in the number
of frauds detected by internal audit or
risk management. Our experience in the
private sector has shown that effective use of
certain tools, such as transactional analytics
and whistle-blowing programs, can be an
important part of the fight against fraud.
For example, investing in IT techniques
such as data analytics, and conducting a
comprehensive fraud risk assessment of your
operations will be of benefit. Responsibility for
preventing, detecting and responding to fraud
lies with all employees in the organisation,
within the context of their own particular
role, but must be led from the top.
We have identified six key action points for the
government sector:
1. Ensure fraud risk assessments are comprehensive
and not just a ‘tick the box’ exercise.
2. Regularly update risk assessments to reflect changes
to the business, especially when new programs are
introduced.
3. When risks are identified, implement a comprehensive
fraud plan that includes nominating a person
responsible for addressing the risk, implementing
systems to monitor the risk, and considering
alternative controls to mitigate the risk.
4. Using data analytics can greatly assist with fraud
detection – government agencies should enhance
their search routines to correlate suspicious
information and enable intelligent analytics.
5. Staff who manage payments, procurement and
contracting processes should receive fraud-specific
training, as the organisation can be protected against
many forms of fraud through their diligence.
6. CEOs and lead executives should become visible in
their leadership of fraud control strategy to set the
right tone from the top.
Our experience in the
private sector has shown
that effective use of
certain tools, such as
transactional analytics
and whistle-blowing
programs, can be an
important part of the
fight against fraud
20 PwC