Ethics and Efficiency Hotline Procedure

Purpose statement

This procedure describes the steps to be taken when efficiencies, fraud, misconduct or other related irregularities are reported through the town’s Ethics and Efficiency Hotline.

Scope

This procedure applies to all town employees and the general public.

Procedure

Where an individual has a suggested efficiency or when suspected fraud or misconduct are observed by or made known to an individual, they may file a report, without revealing their identity, through the Ethics and Efficiency Hotline.

Upon notification of an ethics and efficiency hotline report, the Hotline Team consisting of the CAO, Commissioner of Corporate Services, and the Director, Internal Audit or their designates, shall:

• Determine if the report relates to an urgent matter (e.g. Health and Safety) for immediate action to be taken; or
• Determine if the report relates to an ethics (fraud or misconduct) or efficiency matter and forward accordingly based on type of report:

Fraud reports

Fraud reports are forwarded to the Director, Internal Audit and Director, Human Resources for review. The appropriate Commissioner and Department Head is notified by the Director, Internal Audit or Director, Human Resources for information purposes.

The Director, Internal Audit and the Director, Human Resources will determine if an investigation is required and notify the Hotline Team of their decision. Risk Management will be notified if appropriate.

Misconduct reports

Misconduct reports are forwarded to the Director, Human Resources for review and the appropriate Commissioner and Department Head is notified for information purposes.

The Director, Human Resources will determine if an investigation is required and notify the Hotline Team of the decision. Where the investigation suggests that fraud may have occurred, the Director, Human Resources will involve the Director, Internal Audit.

Efficiency reports

Efficiency reports are forwarded to the appropriate Department Head for review and the appropriate Commissioner is notified by the Hotline Team for information purposes.

The Department Head will assess and report back to the Hotline Team within 90 days on the viability of the suggested efficiency.

Where it is determined that an investigation should be undertaken an investigator will be appointed and shall:

• conduct an investigation of the alleged fraud or misconduct involving other internal resources as appropriate.
• have access to all records, computers and cellphones provided by the town and locations as deemed necessary by the investigator including but not limited to offices, desks, toolboxes, lockers, vehicles etc.
• have the right to search personal items such as purses, bags, backpacks, briefcases, lunchboxes etc.
• issue an investigation report with regards to their findings to the following:
  • Investigation reports involving fraud - to the Director, Internal Audit and Director, Human Resources who, upon review, will report the findings to the Hotline Team.
  • Investigation reports involving misconduct - to the Director, Human Resources who, upon review, will report the findings to the Hotline Team.

The Director, Internal Audit shall:

• contact Risk Management to coordinate the notification of insurers and the filing of insurance claims where necessary.
• report to the external auditors all information relating to the investigation where fraud has been found.

The Director, Internal Audit and Director, Human Resources will meet with the Department Head to discuss the findings of the investigation report involving fraud.

The Director, Human Resources will meet with the Department Head to discuss the findings of the investigation report involving misconduct.

The Director, Human Resources shall:

• recommend disciplinary action to the Department Head, where applicable
• report the findings and recommendations to the Hotline Team.

The CAO and appropriate members of the Executive Management Team shall:

• discuss the findings and recommendations of the investigation report and formulate strategies for mitigation of loss, where appropriate.
• ensure strategies for prevention of similar future occurrences are formulated and implemented.
• review and make a determination if Council should be informed of the investigation report findings.

Note: Where deemed appropriate, the Halton Regional Police may be contacted at any point throughout the above process.

Definitions

Efficiency: an efficiency is a suggestion which when implemented results in a savings of town time, resources or money.

Fraud: fraud encompasses any array of irregularities and illegal acts characterized by intentional deception. The Association of Certified Fraud Examiners defines occupational fraud as the use of one's occupation for personal enrichment through the deliberate misuse or misapplication of the organization's resources or assets.

Examples of fraudulent activities include, but are not limited to:

1. Unauthorized use of town property
2. Misuse of town property, equipment, materials, records or time
3. Inappropriate manipulation or destruction of data
4. Misuse of town-owned hardware and software
5. Forgery
6. Fraudulent claims of reimbursement of expenses
7. Misappropriation of funds (theft)
8. Irregularities in the handling of money
9. Seeking or accepting anything of material value or other inappropriate activities in violation of the Code of Conduct for town employees
10. Any apparent violation of Federal, Provincial or local laws related to dishonest activities or fraud in the workplace
11. Any similar or related activity

Investigator: Town staff or external third party

Misconduct: For the purposes of this procedure, includes but is not limited to unethical behaviour, wilful omission to perform one’s duties, abuse of authority, theft, embezzlement, receipt of bribes, kickbacks, or gifts of significant value, and significant waste of town assets.

Responsibilities

Employees:

• Cooperate fully in any investigation and keep any information about the complaint and/or investigation confidential.

Supervisors:

• Be aware of the potential for fraud or misconduct and proactively implement prevention strategies.
• Act immediately on becoming aware of possible policy violations.
• Cooperate fully and must make their staff available to participate in investigations.
• Keep any information about the complaint and/or investigation confidential.

CAO/Commissioners/Directors:

• Responsible for instituting and maintaining a system of internal control to provide reasonable assurance for the prevention and detection of fraud, dishonest use and other irregularities.
• Act immediately on receiving a hotline report.
• Cooperate fully and must make their staff available to participate in investigations.
• Keep any information about the complaint and/or investigation confidential.
• Report final outcomes to respondent where complaint founded.

Human Resources:

• Act quickly and appropriately as soon as receiving a hotline report.
• Provide guidance on the procedure to supervisors and staff.
• Keep any information about the complaint and/or investigation confidential.
• Inform respondent following an unfounded complaint.

Internal Auditor:

• Responsible for the management and on-going administration of the Ethics and Efficiency Hotline and individual complaints.
• Reports annually to Council on the hotline’s activities.
• Keep any information about the complaint and /or investigations confidential.