LOCAL accounting firm, Deloitte and Touche Namibia, yesterday launched its toll-free Tip-offs Anonymous hotline service for companies in Namibia through which employees can report fraudulent activities occurring in their organisations.
This is in response to a need to assist private and public sector organisations in their fight against ethics and compliance issues and corruption within their organisations.
According to the Association of Certified Fraud Examiners (ACFE), organisations lose an estimated 5% of their revenues to fraud each year. It has been found that the highest detection method of fraud is through tip-offs and it is in this regard that Deloitte and Touche opines that “it is important that company management and staff be able to identify various types of fraud and to have a means to report this so as to minimise the effect of fraud on the business bottom line”.
In outlining the need for a whistle-blowing hotline at the launch, Deloitte and Touche partner Jens Kock said that the hotline will create a mechanism for early detection and serves as a deterrent measure. It is in accordance with relevant legislation such as the Anti-Corruption Act, the Companies Act, the Financial Intelligence Act and is also in line with the King III Report of Corporate Governance.
Furthermore, the initiative is aimed at fostering an ethical culture within organisations by serving as a deterrent for unethical behaviour that causes losses and highlights weak control and high risk areas. “It also provides a means for employees to raise ethics and compliance issues and therefore boost staff morale by promoting ethical values such as openness, honesty, trust, integrity,” Kock said.
Tip-offs is a vital component of a broader ethics and fraud risk management programme which is build on three main pillars of prevention, detection and response. Kock said in terms of prevention, the hotline would serve to assist companies in developing a code of ethics, crime prevention policies, implementation of risk management processes, control assurances by internal audit measures and conduct financial crime risk assessments.
“Detection would be through the establishment of a whistle-blowing facility, a whistle-blowing policy and continuous internal awareness and feedback whilst the response element entails the conducting of forensic investigation, systems and control enhancement, communication and feedback to all stakeholders and possible human resource interventions.”
The Tip-offs Anonymous Hotline offered to companies has been developed in the most user-friendly manner and will be made available to all employees within a company, clients and suppliers and is offered in Namibia in English, Afrikaans, Oshiwambo and Otjiherero during office hours whilst an English service is available 24 hours a day, seven days a week, 365 days of the year. In ensuring the smooth process, which importantly serves to protect the whistle-blower, the process can best be described as follows.
When the whistle-blower contacts the hotline via the toll-free number, email or website, the Deloitte Ethics consultant would remove the whistle-blowers identity from the report, capture the report and forward a notification to the manager responsible who would the alert the client. At this point the client would use their own discretion at what further action, including forensic investigation and the like, would need to be taken to fully investigate the matter. In ensuring accountability, the whistle-blower can contact the ethics line again to get feedback regarding the concern in question.
The Tip-Offs Anonymous Hotline provides fully computerised centres with reliable architecture and best practise network security and strictly monitored password control over all information to safeguard the anonymity upon which the success of the concept is based.
To further entrench this sense of confidentiality and privacy, centre agents are carefully selected and have to sign non-disclosure and confidentiality agreements. Physical security to the premises is provided through restricted access with biometrical techniques as well as 24-hour Close Circuit Television (CCTV) surveillance.
Offered to interested parties at an affordable fee which includes a start-up registration fee ranging from between N$1 000 and N$5 000 and a monthly fee of between N$2 000 and N$6 000, the Tip-offs Hotline offers additional value added benefits such as assistance with development of promotional material, training presentations to employees and a multi-media awareness campaign.
The Deloitte Tip-offs Anonymous was established in early 1999 and has operations in South Africa, Malawi, Singapore, Australia, Brazil, Mexico, the United Kingdom, Germany, France and Ghana.