While NDSU understands the importance of people wanting to remain anonymous, as a state entity, there are laws that we also must comply with in regards to open records. Callers don't have to provide their name to the Hotline. However, with regards to any written or electronic records, NDSU cannot guarantee absolute confidentiality.
Each employee, as a basic condition of employment, assumes responsibility for safeguarding and preserving the assets of the state, university system and its institutions. This includes the expectation to report suspected theft, fraud, unlawful or improper use of public resources. Failure to reasonably report such information may subject the employee to discipline, up to and including dismissal.
Defining Theft, Fraud, Abuse and Waste
As defined in SBHE Policy 611.10, Theft, Fraud, Abuse and Waste are:
Theft: Knowingly taking, exercising unauthorized control over, or making an unauthorized transfer of interest in, or receiving or disposing of property of another, including institution or state property or funds, with the intent to deprive the owner, including, but not limited to, embezzlement, obtaining money by false pretenses, fraudulent conversion or misappropriation of public funds or authorizing or receiving compensation for goods not received or services not performed.
Fraud: Any intentional act or omission designed to deceive others that results in a loss or other disadvantage to resources or achieving a gain or advantage to which an employee or other person would not normally be entitled, including, but not limited to, making false statements or creating or reporting false information.
Abuse: Intentional or willful destruction, diversion, manipulation, misapplication or misuse of resources, including, but not limited to, destruction, damaging or removal of records or property.
Waste: Intentional or willful expenditure, consumption, mismanagement, squandering or use of resources, resulting in unnecessary costs.
- According to the association of Certified Fraud Examiners, the average fraud scheme lasts about 18 months before discovery; moreover, U.S. businesses lose more than 6 percent of revenues each year due to occupational fraud and abuse.
- The most common method of fraud detection is a tip by an employee, customer, vendor, or anonymous source.
- The ability to report incidents anonymously is essential to the success of any hotline.
- Hotlines can help secure a company’s future by further identifying and deterring control weaknesses before they’re allowed to escalate.
- Once a hotline is in place, employees tempted to defraud an organization may begin to have second thoughts.
- A hotline is the most effective way for employees to anonymously report activities of wrongdoing that otherwise may go undetected. Early action may minimize an organization’s loss or mitigate the circumstances if the company itself is charged with wrongdoing due to an employee’s actions.
- A warning system that supports whistleblowers, such as a fraud hotline, encourages employees to act when others do wrong and can inspire confidence in employees that reporting misconduct is in their best interest and will benefit them, other employees, and the company.
- It helps to create a culture that values ethical behavior, is committed to preventing and detecting fraud, and will respond decisively and appropriately to misconduct.
How Fraud is Typically Detected
40% Tips (hotlines)
24% Internal audit
21% By accident
18% Internal controls
11% External audit
Source: ACFE's 2004 Report to the Nation on Occupational Fraud and Abuse