7. Fraud Control Framework

Fraud control is further ensured not only by the implementation of Australian Government legislative requirements but by the adoption and promotion of practices recommended by the Australian National Audit Office (ANAO) and other organisations (e.g. Better Practice Guides). The department has adopted the key elements of Fraud Control Framework recommended in the ANAO Better Practice Guide: Fraud Control in Australian Government Entities 2011.

The Fraud Control Framework provides an overarching approach to effective fraud control within the department. The Executive and Senior Management set the ‘tone at the top’ by creating an ethical culture where staff are encouraged to identify and manage potential fraud risks.

7.1 Governance

A clear and accountable corporate governance framework is vital to the department’s sound operation and performance. Governance in the public sector aims to ensure that outcomes are achieved in a way that enhances confidence in the organisation, its decisions and its actions.

7.2 Portfolio’s Manager Meeting

Occurs weekly and provides the Executive and heads of divisions/offices with the opportunity to share information about activities across the portfolio.

7.3 Executive Board

The Executive Board provides senior leadership, strategic direction, makes key decisions (consistent with the PGPA Act) and reviews risks for the department. Its primary focus is strategic planning, performance monitoring and resource allocation. It also regularly reviews organisational health based on a range of indicators, including financial performance, internal stakeholder relationship management, human resources and ICT capability.

The Executive Board is responsible for the department’s Strategic Plan and setting the department’s risk appetite.

7.4 Security Committee

The Security Committee will provide the Executive Board with assurance that protective security risks to the department are being identified and managed in an effective and efficient manner. This includes:

  • setting the department’s strategic direction for security including management of the work plan for development of the department’s capability in line with the Commonwealth Protective Security Policy Framework (PSPF).
  • ensuring a secure working environment and effective protection of information and assets to satisfy legislative obligations, maintain public confidence and ensure continuity of operations.
  • overseeing the department’s compliance and reporting to the Agency Head, Minister and central agencies against the mandatory requirements of the PSPF.

7.5 Programme Assurance Committee

The Programme Assurance Committee has been established to provide the Executive Board with assurance in relation to programmes within its remit.

The Programme Assurance Committee supports programme Accountable Officers and Senior Responsible Officers in driving excellence in programme design and delivery by providing an open forum for exchanging and sharing ideas. The Committee also facilitates peer learning, including risk evaluation planning for programmes.

7.6 ICT & Data Strategy Committee

The purpose of the ICT & Data Strategy Committee is to enable the department to effectively marshal its data holdings for the purposes of effective administration, monitoring, evaluation and analysis. It does this by developing ICT and staff capability to link, harness, and publish insights from our data, and by fostering a culture that champions open data and data sharing.

7.7 Assurance and Audit Committee

The Secretary has established the Assurance and Audit Committee (the Committee) in compliance with section 45 of the PGPA Act, Section 17 of the PGPA Rule and AAI 1.3.

The objective of the Committee is to provide independent assurance and assistance to the Secretary (and the Executive) on the department’s risk, control and compliance framework, and its financial statement responsibilities.

The Committees responsibilities in terms of fraud are to:

  • review whether management has in place a current and comprehensive risk management framework and associated procedures, for the effective identification and management of the department’s financial and business risks, including fraud;
  • review the process of developing and implementing the department’s fraud control arrangements and satisfy itself that the department has appropriate processes and systems in place to detect, capture and effectively respond to fraud related information; and
  • review reports on fraud from the department’s Fraud Control Officer that outline any identified allegations of fraud, the status of any ongoing investigations and any changes to identified fraud risk in the department.

7.8 Authorised Official – Fraud Control Officer (FCO)

The Secretary authorised the department’s Fraud Control Officer (FCO) to coordinate the development and implementation of a Fraud and Corruption Control Plan (FCCP) for the department, in accordance with Section 10 of the PGPA Rule and AAI 1.2.

7.9 Fraud Prevention

Management, staff, consultants and contractors of the department are the first line of defence when it comes to identifying a range of risks, including fraud. The department encourages all managers and staff alike to be vigilant, and to diligently report any instance of suspected fraudulent activity.

Managers are required to conduct and monitor fraud risk assessments and implement appropriate controls. They are required to monitor their fraud risk strategies and action plans as workplaces change.

7.10 Fraud Detection

The department has adopted fraud detection procedures to deal with fraud as soon as possible after it has occurred. Easily accessible reporting mechanisms are available on the department’s internet and intranet to ensure, staff, clients and the public can report allegations of fraud against recipients of funding administered by this Department, or allegations of unlawful conduct by staff of the department.

Other detection controls in place at the department include review, analyses, reconciliations and audits. The department undertakes targeted reviews of its percipients where there is a high level of risk or a perceived risk of fraud. Staff of the department, play an important role in detecting fraud because of their technical expertise and knowledge of work practices and procedures.

7.11 Fraud Response

The department investigates allegations of fraud against the department and/or its programmes and services in accordance with the Commonwealth Fraud Control Framework (CFCF) and Australian Government Investigation Standards (AGIS). All allegations of fraud, whether internal or external, are assessed with the aim of proving or disproving the allegations. Investigators in the department are required to attain minimum competency qualifications prescribed in the CFCF.

The department’s Fraud Control Section, through the Fraud Investigation Unit, delivers criminal investigation services to the department and provides feedback on outcomes to the relevant Departmental programmes and the Audit Committee.

Serious and complex cases of fraud may be referred to the Australian Federal Police (AFP). Occasionally, matters may also be referred to any of the State and Territory Police Services. Matters investigated by the department may be referred to the Commonwealth Director of Public Prosecutions (CDPP) for consideration of prosecution action.

The department has a policy where it will actively pursue the recovery of any money or property lost through fraud, provided there is a strong prospect of a net benefit to the department from such action.

7.12 Fraud Monitoring, Evaluation and Reporting

This Plan is subject to regular monitoring and review, to ensure internal and external fraud controls and strategies are implemented and effectively achieving intended outcomes.

Quarterly reports are provided to the Executive and Assurance and Audit Committee. The department must certify in the Annual Report that the department has prepared fraud risk assessments and has a contemporary Fraud and Corruption Control Plan in place. Additionally, the department responds to the annual Australian Institute of Criminology survey on instances of fraud.

7.13 Fraud and Corruption Strategy

The Fraud and Corruption Strategy provides for a significant program of fraud control reform in the department. Driving significant and sustainable cultural change, whilst strengthening integrity governance arrangements and transitioning our reactive fraud program to a preventative proactive fraud control and anti-corruption framework.

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