Series 3000: Business/Non-Instructional Operations

3435 Accounts

 3435(a)

Fraud Prevention

All employees, Board of Education members, consultants, vendors, contractors and other parties maintaining a business relationship with the District shall act with integrity and due diligence in matters involving District fiscal resources.

Definition

As used in this policy, “fraud” refers to intentionally misrepresenting, concealing, or misusing information in an attempt to commit fiscal wrongdoing. Fraudulent actions include, but are not limited to:

• Behaving in a dishonest or false manner in relation to District assets, including theft of funds, securities, supplies, or other District properties.

• Forging or altering financial documents or accounts illegally or without proper authorization.

• Improper handling or reporting of financial transactions.

• Personally profiting as a result of insider knowledge.

• Disregarding confidentiality safeguards concerning financial institutions.

• Violating Board conflict of interest policies.

• Mishandling financial records or District assets (destroying, removing, or misusing)

Staff Responsibilities

An employee who suspects that financial fraud, impropriety or irregularity has occurred shall immediately report those suspicions to their immediate supervisor and/or the Superintendent/designee who shall have the primary responsibility for initiating necessary investigations. Investigations shall be conducted in coordination with legal counsel and other internal or external departments and agencies as appropriate.

The Superintendent/designee shall inform employees with financial/accounting responsibilities of the following anti-fraud standards established by the Board:

1. The District shall operate in a culture of honesty and ethical behavior with employees doing all within      their power to further that goal.

2. Employees shall comply with all laws, regulations and court orders of the State of Connecticut and of      the United States, as well as Board policy addressing fiscal matters.

 3435(b)

3. Employees shall practice good stewardship of District financial resources, including timely reporting of     fraudulent expenditures.

4. Employees with financial/accounting responsibilities shall support and follow sound business            practices to the best of their ability and in keeping with their assigned responsibilities and job-related      training by:

a. Maintaining and protecting District financial records;

b. Performing one’s job with the highest attention to detail to minimize and prevent error, falsification        of accounting records, and omission of transactions;

c. Reporting knowledge of fraud or suspected fraud, including intentional misstatements and              omissions of amounts or disclosures;

d. Guarding against misappropriation of assets;

e. Refusing to reveal investment activities engaged in or contemplated by the District to unauthorized       persons or agencies; and

f. Resisting incentives, pressures, and negative attitudes that detract from performance of assigned         responsibilities.

Internal Controls/Investigations

The Superintendent/designee shall be responsible for developing internal controls to aid in preventing and detecting fraud or financial impropriety or irregularity within the District. Reports of suspected fraudulent activities shall be investigated in a manner that protects the confidentiality of the parties and avoid unfounded accusations. Employees involved in the investigation shall be advised to keep information about the investigation confidential.

If an investigation substantiates occurrence of a fraudulent activity, the Superintendent/designee shall issue a report to appropriate personnel and to the Board of Education. Final disposition of the matter and any decision to file a criminal complaint or refer the matter to the appropriate law enforcement and/or regulatory agency for independent investigation shall be made in consultation with legal counsel. Results of the investigation shall not be disclosed to or discussed with anyone other than those individuals with a legitimate need to know.

(cf. 3100 – Budget/Budgetary System)

(cf. 3320 – Contracts)

(cf. 3430 – Periodic Financial Reports)

(cf. 3434 – Periodic Audit

Policy adopted:  October 19, 2015  THOMASTON PUBLIC SCHOOLS Thomaston, Connecticut

3435(a)

Fraud Prevention and Investigation

Fraud, financial improprieties or irregularities include, but are not limited to:

1. Forgery or unauthorized alteration of any document or account belonging to the District.

2. Forgery or unauthorized alteration of a check, bank draft or any other financial document.

3. Misappropriation of funds, securities, supplies or other assets.

4. Impropriety in the handling of money or reporting of financial transactions.

5. Profiteering as a result of insider information of District information or activities.

6. Disclosing confidential and/or proprietary information to outside parties.

7. Accepting or seeking anything of material value from contractors, vendors, or persons providing services    to the District.

8. Destroying, removing or inappropriately using of records, furniture, fixtures or equipment.

9. Failing to provide financial records to authorized state or local entities.

10. Failure to cooperate fully with any financial auditor, investigators or law enforcement.

11. Any other dishonest or fraudulent act involving District monies or resources.

The District will seek to prevent and detect in an early stage any embezzlement of District funds by looking for the following tell-tale signs of embezzlement:

1. false invoices

2. overbilling the district for maintenance items

3. checks issued to fictitious companies

4. check ledger containing duplicate entries

5. checks written by business office staff to their personal accounts

6. checks mailed to residences or P.O. boxes of administrators or business office staff

7. forged signatures

8. unauthorized use of a signature stamp

9. income that is understated

10. expenses that are overstated

11. payments to unaccredited schools that issue phony academic credentials

12. payments of salary increments based on having phony academic credentials issued by unaccredited      schools

3435(b)

The Superintendent or designee shall investigate reports of fraudulent activity in a manner that protects the confidentiality of the parties and the facts. All employees involved in the investigation shall be advised to keep information about the investigation confidential.

If an investigation substantiates the occurrence of a fraudulent activity, the Superintendent or designee shall issue a report to appropriate personnel and to the Board of Education. The final disposition of the matter and any decision to file a criminal complaint or to refer the matter to the appropriate law enforcement and/or regulatory agency for independent investigation shall be made in consultation with legal counsel. The result of the investigation shall not be disclosed to or discussed with anyone other than those individuals with a legitimate right to know.

In addition, the District will take the following steps to protect funds and property from theft:

1. label all goods, materials, and equipment

2. establish adequate controls to account for their location, custody, and security

3. annually audit the inventory of equipment

4. update a listing of such equipment to reconcile the audit with the District’s inventory system

5. document and account for any transfers and/or disposals of equipment

Regulation approved:  October 19,  2015 THOMASTON PUBLIC SCHOOLS Thomaston, Connecticut