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Anti-Corruption Day: Fraud Prevention in a Volatile World


9 December 2024

“Preventing and disrupting fraud risk is fundamental to achieving impact from scarce resources in ending the three diseases."

Tracy Staines
Inspector General

#AntiCorruptionDay
#IACD2024

Safeguarding Global Fund Investments with Integrity


The world continues to grapple with the poly-crises of climate change, tumultuous geopolitics, insecurity and economic crises. The crises and related fiscal constraints are diverting resources from global health towards other priorities; and further creating opportunity for fraud and abuse, which continue to rise globally.

In a rapidly changing and resource-constrained global health environment, we simply need to do more with less. This means ensuring that every dollar goes to our lifesaving programs while we stay one step ahead of the fraudsters. To do this, we must focus on stopping fraud and abuse before it takes hold and ensuring that the safeguards put in place work.

 

How Has the Global Fund Approached Fraud Risk?

Over the last ten years, the Global Fund has dedicated significant amounts of human and financial resources to managing fraud risks as part of its overall integrated risk management, which is built on three lines of defense:

  • A first line that includes the Country Team and support of in-country assurance providers;
  • A second line made up of the Risk Management Department (Risk), the Ethics Office (Ethics) and other risk owners, such as the Grant Finance & Accounting and Fiduciary Risk Oversight teams in the Finance Department (Finance), Supply Operations; and,
  • A third independent line which includes the Offfice of the Inspector General (OIG) who report to the Board or its Committees.

The organization has developed policy frameworks such as the Policy to Combat Fraud and Corruption and Ethics and Integrity frameworks, which are fundamental to fraud risk management. The functional teams with support from the second line functions work with grant implementers to institute country-level measures that aim to balance program implementation with managing donor funds responsibly.

The OIG investigates alleged fraud and abuse and performs targeted prevention initiatives leveraging its unique expertise to support the Secretariat in preventing fraud in its programs. The OIG provides guidance to the Secretariat to aid operational decisions that mitigate fraud risks and safeguard the Global Fund’s investments. This aligns with the Global Fund’s Anti-Corruption framework, which manages fraud and corruption risks essential to achieving our mission's impact.

Overall, these measures continue to support impact from programs financed by the Global Fund. However, as mitigation measures are designed to guard against known fraud schemes, more complex ones emerge. Sophisticated fraud schemes such as cyber security and phishing, health product substitution, substandard or counterfeit medicines and compromised data quality could have devastating outcomes as they divert critical resources from our programs to fight HIV, tuberculosis and malaria, and compromise access to life-saving care. These require continuous monitoring and agility in mitigating fraud risk, an area the Global Fund has been strengthening with routine thematic reviews and incident reporting mechanisms.

 

A Focus on Prevention as the Fraud Risk Landscape Evolves

The ACFE Occupational Fraud 2024 report indicates that more than half of occupational frauds occur due to lack of internal controls or an override of existing internal controls. As such we must combine our efforts to strengthen controls and assurance to respond to these threats to prevent or reduce the likelihood of fraud.

E-Lesson: Product Fraud, Theft and Abuse

The OIG has created a series of e-Lessons for our implementers, secretariat colleagues, assurance providers and supporters to raise awareness of the types of wrongdoing most prevalent in our grant programs.

Learn about the common product issues schemes that can impact Global Fund activities and why this matters, and you will be able to test your knowledge through an interactive case study and a final quiz.

Start e-Lesson

Fraud prevention is a shared responsibility of all stakeholders including Global Fund Secretariat, implementers, and OIG. This underlines why the OIG is working with our own Secretariat and the in-country partners to enhance internal controls, enhance financial oversight, and promote transparency in procurement and grant management as cornerstones in defeating the three diseases.

Fraud prevention is vital to protecting the Global Fund’s programs against the wrongdoing that threatens to divert our investments. Fraud and abuse have severe consequences for most vulnerable who mostly need the services provided by the Global Fund. This reminds me of the U.N.’s International Anti-Corruption Day theme “Uniting with Youth Against Corruption: Shaping Tomorrow’s Integrity”. After all, the youth have the biggest stake in the fight to protect a future free of HIV, tuberculosis and malaria and the most to lose if our precious resources are stolen by fraud and corruption.

Preventing fraud before it occurs is less disruptive to our beneficiaries, helps us achieve more impact and costs much less afterwards.

 

Our Fraud Prevention Activities

The OIG has built capabilities in data analysis and subject matter expertise over the years to support the Secretariat’s fraud risk management program. By leveraging intelligence, data, lessons learned from previous and ongoing engagements, and in-house subject matter expertise, the Office of the Inspector General offers guidance and insights on fraud and abuse related issues. Our fraud prevention activities are delivered under four broad categories:

Outreach, Training & Education

WHAT WE DOTYPICAL SERVICE
Partner with stakeholders to deliver training and outreach on fraud risk factors identified by our core investigation and assurance activities.

Our resource center provides videos, articles and e-lessons to help thwart wrongdoing from the start.
  • During the COVID-19 pandemic the OIG collaborated with the Finance and Risk Departments to organize webinars attended by implementers across 15 countries.
  • In 2024, we organized specific fraud risk awareness sessions in over 12 countries.
  • Recognizing the increasing human rights concerns in programs, we partnered with our Communities Rights and Gender department to organize webinars for identified organizations and implementers on related risks and reporting channels.
  • Grant implementers are a major stakeholder in fraud prevention at the country level. The OIG and Global Fund Secretariat organized a workshop with over 80 representatives from implementers of Global Fund grants to share experiences in tackling fraud risks in program delivery.

 

Consultation & Guidance

WHAT WE DOTYPICAL SERVICE
Assist the Secretariat in making real-time decisions, or addressing future risk considerations, based on ongoing or previous OIG work. The knowledge and intelligence gathered as part of ongoing cases are contemporaneous shared with the Secretariat to inform preventive or mitigation measures prior to the conclusion of ongoing cases.
  • We continuously shared insights from ongoing cases with a Country Team to help them redesign implementation arrangements of high impact portfolios to ensure continuity of service delivery.
  • Lessons from one of our cases helped the Supply Operations Team in their review of cost proposals from suppliers in other ongoing tenders.

 

Policy Review & Development

WHAT WE DOTYPICAL SERVICE
Provide input on Operational Policy Notes and other policy documents, and terms of references to address integrity risks, governance, risk management and controls related issues.
  • The OIG works with various country teams in defining appropriate terms of reference for assurance providers, such as the Local Fund Agents, to better respond to the identified risks.
  • We provided input to the Secretariat in defining the terms of reference for a fraud risk assessment to support proactive identification of weaknesses and related mitigation measures.

 

Data-Driven Risk Mitigation Products

WHAT WE DOTYPICAL SERVICE
Share tailored knowledge derived from OIG’s case intake, investigative, and other assurance findings. This includes assessments of emerging themes and trends from OIG’s activities and engagement with stakeholders.
  • The OIG shares themes and trends in fraud risks with the Secretariat’s Portfolio Performance Committee which performs thematic fraud risk reviews in Global Fund Programs as part of the Organization’s fraud risk monitoring.
  • We leverage data analytics and other tools to proactively identify potential fraud and abuse for appropriate response by the OIG and/or the Secretariat.

 

By taking a coordinated and collaborative approach with functional and second line teams, such as Ethics, Risk and Finance, the OIG supports the Secretariat and implementers to manage fraud and integrity issues. Together we can ensure that our services reach those most in need!

 

What is Next on OIG’s Fraud Prevention Activities?

Preventing fraud is not just about protecting resources, it is about safeguarding our mission to save lives. Together, we can work to shape a world where fraud and corruption have no place.

The OIG will continue to support the Secretariat and implementers in mitigating fraud risks through:

  • Proportionate response to allegations of fraud and abuse
  • Quarterly newsletter with relevant and timely case studies on thematic areas that present ongoing risks
  • Proactive fraud trend monitoring, analysis and insights (i.e., brown bags, regional thematic workshops)
  • Counter fraud awareness through e-lessons and articles regarding prohibited practices

The OIG coordinates with Ethics, Risk and Finance in fraud prevention activities and I encourage Global Fund teams and implementers to reach out to any of them for assistance on fraud prevention.

 

 


 

 

REPORT FRAUD AND ABUSE

Associated with:

Topic
Governance