CONNECTING THE DOTS:
The purpose of this six-part article is to help connect the dots between some of the recent policy initiatives that call for increased accountability measures and the forces behind them. There are four key issues that are driving our focus on accountability. In the last two issues, we reviewed the theological imperative and societal expectations.
The third issue relates to fraudulent activity which we are encountering more frequently than in the past. What has been particularly troubling is that, in a number of instances, fraud has been committed by officers and employees who were in charge of a ministry unit. We have subsequently discovered that, while there were internal controls in place, the leaders of these units were able to circumvent the controls or set them aside in order to appropriate Salvation Army assets for personal benefit.
When you mention fraud, people seem to think instantly of the significant transactions that are picked up by the media. We are just as concerned, however, about smaller transactions that are repeated over long periods of time.
We have observed that some individuals feel entitled to help themselves to whatever comes in. I hear stories of staff members who shop for their weekly groceries at the food bank or help themselves to the best items that are donated to the thrift store. Make no mistake about it: these transactions are fraudulent too.
I know that there are times when we receive donations of food with a limited shelf life that is difficult to distribute to those in need in the time available. Sharing such a gift with our staff has been the only means of ensuring that food doesn't go to waste. But I think we need to rethink the frequency with which this sort of thing happens in the organization and develop better ways of ensuring that donations are channeled to those who need them.
In some instances, our auditors examine situations in which assets have been misused, but it is difficult to establish whether fraud or mismanagement is the cause. But the results of mismanagement and fraud are the same: organizational assets have been misused. Fraud requires intent to defraud; mismanagement implies carelessness rather than intent to defraud. But the bottom line is the same: loss of organizational assets, regardless of whether someone has benefitted personally or not.