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Cases
A case from CongoClick to see a little video about a corruption case in Congo. This is a case that we have learnt from and improved our systems. Unfortunately, at the same time we have lost money. |
Current cases
June 2011: Corruption allegation against a partner in Africa
Content of the complaint: DCA received a corruption allegation againt a director of a partner organisation in Africa. The allergations were about private use of the organizations vechile and theft of materials for building houses.
What did we do: In cooperation with the board of the organsiation the case has been investigated. It has not been possible to prove corruption or theft. By the end of 2011 the cooperation is ending with the partner as the project is finalized.
Lessons learnt: It is crucial to have systematic monitoring and follow-up on projects, so that suspicion of corruption can be proven or as here rejected.
2010 September: Audit reports revealed poor financial performance of partner organisation in Latin America
An audit report was critical to the financial performance of a partner organisation of DCA, therefore a 100% audit was executed. This 100% audit report reconfirmed the severity of the case. After revealing the fraud DCA stopped the cooperation with the partner and in cooperation with other (former) donors the case is taken to court. The final conclusion has not yet been drawn.
2010 September: Partner in Zimbabwe used fake auditing firm
It was revealed that a partner in Zimbabwe supported by DCA used a fake branch of an international recognised auditing firm. The audit reports are now being reviewed and another auditor will have to audit the activities and financial performance of the organisation, to reveal if DCA funds were misused. DCA monitored the project frequently.
DCA has a close cooperation with the board of the organisation who was as surprised to find that the auditor was using a false name.
November 2009: Suspicion of corruption in partner organisation in Africa
Content of the complaint: DanChurchAid employees reacted to irregularities in the documentation and reporting from a partner organisation in East Africa. Suspicion of use of project funds for private purposes and disregard of procurement procedures led to further investigation. At present there is no proof of corruption or fraud, so further details will not be published.
What did we do: We informed our back-donors about the case and initiated an investigation of the partner. An external audit is currently carried out.
Conclusion: The investigation and the audit uncovered irregularities for DKK 157.025 (approximately USD 28.550) during the period 2008-2009. The irregularities included payments to an employee, undocumented or unjustified expenses, suspicion of conflict of interest concerning expenses, deficient administration and control as well as other unjustified expenses which were addressed by the auditor. DanChurchAid will cover the loss with own funds and has chosen not to initiate a trail against the former management of the organisation. It is assessed that the partner has no values and that a trail would be too costly and time consuming.
Out of the DKK 157.025 an amount of DKK 10.220,50 was embezzled by a former employee and the amount has been claimed to be paid back.
Lessons learnt
A case like this is very unfortunate and it is crucial that DanChurchAid learns from this case, in order to avoid similar cases in the future.
Monitoring of projects is essential. Trust is an important aspect of DanChurchAids approach to working with partners, but there is also a need for control in form of e.g. monitoring visits, where activities are followed and verified. In relation to monitoring visits, it is important that DanChurchAid staff have a say in selecting project sites visited.
Specifically DanChurchAid in East Africa has shortened internal deadline for submitting monitoring reports (draft). Any suspicions (“alert”) are to be reported immediately to the regional representative in order to secure timely and proper follow-up.
The Executive Board of the partner organization plays a crucial role in the event of corruption. When a corruption case is revealed the Board, is in charge of the actual decisionmaking regarding laying off staff and supportingthe following investigation. Therefore, it is of great importance to secure the Board's cooperation and involvement at as early a stage as possible.
When investigating corruption cases it is crucial to consider the security for staff involved. Regular and, to the extent possible, transparent communication on decisions made in the handling of the case.
August 2009: Suspicion about corruption partner in Africa
Content of the complaint: A partner organisation in Africa was suspected of misuse of funds. A closer assessment showed that the problem was mainly within the management and the administrative systems.
What did we do: We had a dialogue with the partner organisation on how to tackle the suspicion, and we discussed management problems. Some key persons in the management were changed. We decided to carry out an extraordinary audit, which is still ongoing. Next step will be based on the conclusions of the audit. Our back-donor Danida has been notified.
Follow-up: The external audit showed that purchase in relation to building seed bank did not follow procurement procedures. Some purchased were found to be overpriced. A radio bought to the project was given away. The auditor concluded that DKK 110.721 was misused. DCA has covered the loss. DCA has full confidence in the new management of the organization. The new management has been cooperative throughout the investigation. DCA is therefore still supporting the organisation, as the organisation is seen trustworthy and doing a very important job.
Lessons learnt: Cases like this one are very unfortunate. In the process DCA has worked closely with partner organisation on organisational changes. These changes have resulted in an improved organisation.
Read more about corruption cases in the annual complaint report