Corporate Fraud Prevention Policy

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Category: Governance

Policy Number: GOV-110

Approved by: Council Resolution # C149-2023 – June 14, 2023

Administered by: Legal Services

Effective Date: June 14, 2023

1. Background .............................................................................................................................. 2

2. Purpose .................................................................................................................................... 2

3. Application and Scope ............................................................................................................. 2

4. Outcomes ................................................................................................................................. 2

5. Policy Statements .................................................................................................................... 2

6. Roles and Responsibilities ....................................................................................................... 4

7. Monitoring and Compliance .................................................................................................... 5

8. Definitions ................................................................................................................................ 6

9. References and Resources ....................................................................................................... 6

10. Revision History ....................................................................................................................... 7

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1. Background

The City of Brampton (“City”) is committed to maintaining an environment of fairness,

ethical behaviour, honesty, and intolerance of Fraud. In line with that commitment, the

City has implemented the Corporate Fraud Prevention Policy to reinforce the City’s

commitment to Fraud prevention and detection and set out the City’s response to

allegations of suspected or actual Fraud.

2. Purpose

This Policy aims to establish the requirements and responsibilities for the prevention,

detection, and reporting of Fraud, the conduct of Fraud investigations, and the

consequences when Fraud has occurred.

3. Application and Scope

This Council Policy applies to all employees or persons acting on behalf of the City,

including management, bargaining unit staff, and full-time, part-time, permanent,

volunteer, and contract employees.

3.1 Exceptions

3.1.1 This Council Policy does not apply to the Mayor and Councillors, whom the

Council Code of Conduct governs. Any allegations implicating the Mayor and

Councillors may be directed to the Office of the Integrity Commissioner.

4. Outcomes

4.1 An environment of fairness, ethical behaviour, honesty, and intolerance of Fraud.

4.2 Commitment to Fraud prevention and detection.

4.3 Defined roles and responsibilities in response to suspected acts of Fraud.

5. Policy Statements

5.1 This Policy addresses specific guidelines and responsibilities regarding actions for

detecting, reporting, and investigating Fraud or other similar irregularities.

5.2 The City will identify and promptly investigate any possible Fraud or unethical

activities against the City and pursue legal remedies when appropriate.

5.3 The City will take appropriate disciplinary and legal actions against employees and

entities, up to and including termination of employment or contract, restitution, and

forwarding information to the appropriate authorities for criminal prosecution.

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5.4 This Policy clarifies acts that are considered Fraudulent and describes the steps to

be taken when Fraud or other related irregularities are suspected or have occurred.

This statement also includes the procedures to follow in accounting for missing

funds, restitution, and recoveries.

5.5 Fraud Assessment and Investigation

a) Internal Audit will carry out an initial assessment. A determination of

whether the allegation warrants additional investigation will be made

after completing this assessment.

b) The Director of Internal Audit may delegate the investigation to City

management, Internal Audit staff, or a third-party investigator.

Allegations with implications that are in the purview of an Accountability

Office may be forwarded to the appropriate office. See “Special Cases”

for exceptions.

c) Internal Audit requires regular updates, findings, recommendations, and

confirmation of action taken, if applicable, from City management or a

third-party investigator.

d) Not all Fraud Allegations will result in an investigation. For example,

Internal Audit may not investigate allegations that lack relevant details,

have no reasonable factual basis to proceed, or are false or vexatious.

e) Investigators of suspected Fraud will not disclose or discuss the

investigation with anyone other than those with a legitimate need to

know.

f) Internal Audit, in consultation with Legal Services, may report suspected

illegal activities to Peel Regional Police or appropriate government

agency.

g) Every reasonable effort shall be taken to recover losses due to Fraud.

5.6 Special Cases

a) Allegations Implicating Identifiable Senior Positions

Where the Chief Administrative Officer (CAO), Department Heads, City Clerk, City

Solicitor, Director of Internal Audit, Director of Human Resources, or City Treasurer are

implicated in allegations of Fraud, a third party will be retained to investigate the

allegations and transmit their findings to Brampton City Council.

b) Allegations on Matters That Fall Under the Accountability Offices

From time to time, allegations on matters intended for the Accountability Offices as

defined in the Municipal Act, 2001 may come through the City’s Ethics Hotline. In such

cases, Internal Audit will advise the complainant(s), forward the allegation to the

appropriate City of Brampton’s Accountability Office, and close the case. Cases may

also be forwarded to the City of Brampton’s Accountability Offices if an aspect of an

allegation falls within their purview. The City has established three Accountability Offices:

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The Integrity Commissioner, Lobbyist Registrar, and Closed Meeting Investigator. In

addition, the Ontario Ombudsman currently functions as Brampton’s Municipal

Ombudsman.

5.7 Protection Against Reprisal

The City will not tolerate any form of retaliation against persons who, in good faith,

provide information concerning Fraud. No one governed by this Policy shall retaliate

against an employee reporting Fraud with the intent of adversely affecting the terms or

conditions of employment or otherwise.

5.8 This Policy is designed to augment any other corporate policies containing related

information. It does not replace or preclude them. To the extent that this Policy may

conflict with any other corporate policies containing related information, this Policy

will take precedence to the extent only of such conflict. Alternatively, please refer to

clause 6.10 of this policy for resolution.

6. Roles and Responsibilities

Employee Responsibilities

6.1 All employees must review this Policy annually and sign an acknowledgment form.

When suspected Fraudulent incidents or practices are observed by or made known to

any person governed by this Policy, the following will be done:

a) Suspected incidents or practices of Fraud will be reported to the

supervisor for reporting to the proper management official. When the

employee believes the supervisor may be involved in inappropriate

activity, the employee will make the report directly to a higher level of

management.

b) All suspected Fraudulent incidents or practices must be reported to the

City’s Ethics Hotline immediately. Reporting can be done either by the

employee, their supervisor, or the Human Resources staff that they have

consulted with. Reporters using the Hotline may choose to remain

anonymous.

c) Any City employees will report suspected Fraud to the City’s Ethics

Hotline and, when doing so, must act in good faith and have reasonable

grounds for believing the information provided. No person shall make an

allegation that is known to be false.

d) The person reporting the Fraud shall provide sufficient information to

allow a reviewer to assess the allegation. This should include a synopsis

of the Fraud, specific actions, dates or timelines, and persons involved.

e) All employees must cooperate with Fraud investigations

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Management Responsibilities

6.1 Management should be familiar with the types of Fraud in their area and create and

maintain effective monitoring, review, and control procedures to prevent and detect

Fraud, misappropriations, and other irregularities.

The Corporate Leadership Team is responsible for taking corrective actions on confirmed

Fraud and engaging Human Resources and Legal Services as required.

Human Resource Responsibility

6.1 Human Resources will provide all new employees and volunteers with a copy of the

Policy as part of their orientation. In addition, the new employees and volunteers

will acknowledge receipt of the Policy in writing.

6.2 On an annual basis, all employees must read and acknowledge understanding of

this Policy by signing an acknowledgment form.

6.3 Human Resources will retain copies of the written acknowledgment by individuals

who have received this Policy. Acceptable record retention includes digital

acknowledgement and check-box.

Internal Audit Responsibilities

6.4 Internal Audit is responsible for managing and coordinating the investigation of all

suspected Fraud and related investigative activities with appropriate parties and

authorities.

6.5 Internal Audit shall advise the Council and the Chief Administrative Officer of any

allegations involving significant and imminent risk to the City.

City Legal Services Responsibilities

6.6 City Legal Services owns the City’s Fraud Prevention Policy and is responsible for

this Policy’s periodic review, revision, and interpretation.

7. Monitoring and Compliance

7.1 Consequences of non-compliance

7.1.1 Failure to follow this Policy may result in disciplinary action, up to and

including termination of employment and prosecution by appropriate

authorities.

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8. Definitions

8.1 ‘Fraud’ for this Policy means all unethical or dishonest acts, deception, abuse,

waste, and misconduct including, but not limited to:

a) Diversion, manipulation, misapplication, mistreatment, or misuse of

City resources;

b) A false representation of facts, including making false or misleading

statements or trying to hide wrongdoing by a person or an

organization;

c) Deception which is intentional and results in a benefit to a person,

causes damage, harm, or loss to the City or others;

d) Unnecessary spending or careless squandering of the City’s

resources;

e) Conduct contrary to the Employee Code of Conduct, specifically:

• Failure to disclose a conflict of interest, whether direct or indirect;

• Breach of trust;

• Solicitation of gifts and benefits; and

• Unauthorized use of City property and Assets for personal benefit, gain, or

enjoyment.

Please refer to Appendix A for some examples of Fraud under this Policy.

9. References and Resources

This Council Policy should be read and applied in conjunction with the following

references and resources as updated from time to time. Please note that some of

the following documents may not be publicly available.

9.1 References to related bylaws, Council policies, and administrative directives

• Employee Code of Conduct

• Employee Expense Policies

• Information Technology Use Policy

• Respectful Workplace Policy

• Purchasing Card Policy PUR-120

• Purchasing By-Law 19-2018

• Conflict of Interest Provincial Offences Act Policy

9.2 References to related corporate-wide procedures, forms, and resources

• Fraud Service Card

• ClearView Connects (Ethics Reporting Hotline)

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10. Revision History

Date Description

2018/03/07 Replaces Policy 2.14.0 Corporate Fraud Prevention Policy

2019/09/25 The annual review resulted in minor edits. Amended by Council

Resolutions C353-2019 and AU0352019.

2023/05/25 Policy amended through Council Resolution C149-2023.

The review resulted in revisions/additions to clarify the following:

• City Legal Services, as the Chief Administrative

Officer’s designate, owns the Fraud Prevention Policy

and is responsible for the policy’s periodic review,

update, and interpretation.

• The City’s Fraud Hotline has been renamed to

“Ethics Reporting Hotline.”

• Internal Audit leads the assessment, investigation,

and reporting processes of allegations received by the

Ethics Reporting Hotline.

Where the CAO, Department Heads, City Clerk, City

Solicitor, City Treasurer, Director of Human Resources, or

Director of Internal Audit are implicated in allegations of

ethics violations, the investigative process has been

updated.

In addition, minor changes were made to clarify the “Outcomes”

and “Policy Statement” sections. In addition, “Director, Internal

Audit” has replaced “Chief Audit Executive.” The revised policy

mandated reporting of “All suspected fraudulent incidents or

practices must be reported to the City’s Ethics Reporting Hotline

immediately.

Reporters using the Hotline may choose to remain anonymous.” to

paragraph 6.2 b) based on benchmarking against other

municipalities.

2024/05/01 Next Scheduled Review