29 May 2012

Tanzania: WWF Staff in Financial Scam

AN audit report by Ernst & Young has established that 400,000 US dollars (approx. 624m/-) was misappropriated by the WWF local staff who forged hotel, taxi receipts and direct corruption.

As a result of the audit report, eight employees have been terminated while six have resigned during the investigation or disciplinary process.In a statement, the World Wildlife Fund International President, Yolanta Kakabadse, and Director General Jim Leape said the lost money will be refunded to donors who include Norwegian and American governments.

"E&Y's investigations confirmed fraud in all four projects that were reviewed. The amount of fraud is approximately 400,000 dollars; the total funding for the projects involved is around 15.4 million dollars.

"Such fraud is unacceptable and we have taken decisive action to terminate the employment of all employees found to have committed fraudulent acts," the statement noted.The statement further said that two projects funded by the Norwegian Ministry of Foreign Affairs which E&Y conducted a forensic investigation, established that fraud was experienced.

"This report confirms that all eight project employees submitted fictitious hotel receipts during 2011. "The basic mechanism of the fraud is that project employees would claim to stay in a certain hotel but would instead stay in a cheaper hotel, and then submit falsified receipts for higher amounts from the hotel where they claimed to stay," the statement added.

Two projects funded by United States Agency for International Development (USAID) were also affected as local staff who have long complained against poor remuneration compared to their foreign peers resorted to forging receipts.

Five of the project staff were confirmed to have submitted fictitious hotel receipts during 2011, in a similar arrangement as for the Community Social Organization and REDD (Reduced Emissions in Deforestation and Degradation) projects.

The E&Y audit report also conducted a single special investigation on one finance staff, after a whistleblower voiced allegation of fraud against the official. "One of these allegations, concerning forged signatures on human resources related documents, was confirmed to be true. The individual involved has left WWF. No project funds were involved," the statement pointed out.

Allegations of wrongdoing were first made against key WWF Tanzania staff last December which led to suspension and resignation of several personalities as E&Y was commissioned to undertake an audit of the Fund's accounts.

"In addition to the above investigations, we engaged E&Y to review WWF International's overall control framework and management oversight processes. Their review looked at controls, particularly those around travel expenses, as they were implemented in Tanzania, and the management oversight and supervision from the WWF-Eastern and Southern Africa regional office and from WWF International up to the Director General's office.

The purpose of their review was to assess the root causes of the fraud in Tanzania, and to propose recommendations to reduce the risk of fraud going forward," the statement concluded.

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