Winnipeg Free Press - PRINT EDITION

Hotline for fraud tipsters heading for vote

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Local tipsters may be given a formal structure to anonymously report fraud to the City of Winnipeg.

This week, city council will vote on a recommendation to expand Winnipeg's internal fraud and waste hotline to the public. If approved, city auditor Brian Whiteside said it will take about 60 days to set up and Winnipeg will have a public tip line ready by the end of May.

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The move comes nearly one year after Winnipeg first established a fraud hotline for employees to report tips about wrongdoing in city departments. Last April, the city launched the hotline after an audit found many cases of waste and fraud likely go unreported because the city requires staff to report allegations to a supervisor.

In its first eight months, the hotline received a total of seven complaints -- including three reports of theft, embezzlement and fraud, three complaints regarding violation of laws, policies and procedures and one report of conflict of interest or unethical behaviour. A city report said one complaint was substantiated and auditors recommended Winnipeg revise how it issues receipts to citizens for payments and enhance controls and surveillance of cash-handling areas.

The report said although the hotline's initial use was low, it is important to enhance "public confidence in civic government by providing a method to the public to report fraud and wrongdoing."

Whiteside said other cities such as Calgary, Toronto and Ottawa have fraud hotlines that are open to the public, and Winnipeg residents will be able to call a toll-free number or make an anonymous report online.

The hotline is operated by a third party.

"It's just another way of opening the door to providing information from not only staff but the public that may alert us to fraud or other wrongdoing," Whiteside said. "It's another avenue to receive information to help us manage the detection of fraud better."

Whiteside said other cities have found there's not enough evidence to take action on about 30 per cent of the calls to the hotline, noting some reports are vague or are simply a tipster's opinion. However, he said getting more information is key to detecting instances of fraud.

Toronto identified the need to improve its monitoring of employee benefits after their hotline received a complaint an employee on long-term disability was working for a second employer, according to a 2012 audit report. The city received 774 complaints through the hotline, according to the auditor general's report, and a number of complaints continue to involve conflict of interest, abuse of sick leave and eligibility of employees on long-term disability.

Whiteside said City of Winnipeg auditors were able to identify some weak spots in how the city issued cash receipts after the hotline received a tip regarding confusing receipts. He said Winnipeg has now clarified its paperwork policy and put more controls in place.

Whiteside said it's hard to predict how many more calls the city will receive if the tip line becomes public.

jen.skerritt@freepress.mb.ca

Republished from the Winnipeg Free Press print edition March 19, 2013 A7

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