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Agenda Item
ASR
Control 24-000438 |
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MEETING
DATE: |
06/25/24 |
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legal entity taking action: |
Board
of Supervisors |
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board of supervisors district(s): |
All
Districts |
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SUBMITTING Agency/Department: |
County
Counsel (Approved) |
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Department contact person(s): |
Leon
J. Page (714) 834-3300 |
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Patrick
Bruso (714) 315-6692 |
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Subject: 2023
Orange County Fraud Hotline Annual Activity Report
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ceo CONCUR |
County Counsel Review |
Clerk of the
Board |
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Concur |
No Legal Objection |
Consent Calendar |
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3 Votes Board Majority |
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Budgeted: N/A |
Current
Year Cost: N/A |
Annual
Cost: N/A |
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Staffing
Impact:
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No |
#
of Positions: |
Sole
Source: N/A |
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Current Fiscal Year Revenue: N/A
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Prior Board Action: 4/11/2023 #8; 3/8/2022 #7; 2/23/2021
#2; 2/25/2020 #3 |
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RECOMMENDED
ACTION(S):
Receive and file 2023 Orange County
Fraud Hotline Annual Report.
SUMMARY:
The 2023 Orange
County Fraud Hotline Annual Report provides a statistical summary of activity
for the period of January 1, 2023, through December 31, 2023, and background
information on the Fraud Hotline process.
BACKGROUND
INFORMATION:
The Orange County
Fraud Hotline (Fraud Hotline) was first established September 1, 1994, and,
after a short period of inactivity during the County’s bankruptcy, was
reinstated May 3, 1996. The OC Internal
Audit Department administered the OC Fraud Hotline as part of its ongoing fraud
detection and prevention effort until August 20, 2015. On August 4, 2015, the Board of Supervisors
(Board) approved delegation of responsibility for operation of the Fraud
Hotline to the Office of the County Counsel with assistance provided by the
Auditor-Controller. This delegation
became effective on August 21, 2015.
Under the direction of County Counsel, the Fraud Hotline Managers
organize, supervise and conduct the investigations of the numerous and varied
complaints made through the Fraud Hotline.
Your Board
received and filed prior annual Orange County Fraud Hotline Annual Reports on
February 25, 2020, February 23, 2021, March 8, 2022, and April 11, 2023.
The Fraud Hotline
allows County management to discover and provide a remedy for acts of fraud,
waste or abuse by County employees and County vendors. A robust confidential Fraud Hotline provides
an opportunity for concerned employees and residents to freely disclose fraud,
waste or abuse occurring in government operations in confidence without fear of
retaliation or disclosure. Fraud is an
intentional act that results in the misstatement of financial records or theft
of the County’s assets. Waste and/or abuse
of County resources would include, for example, the use of a County computer to
run an outside business. Violations of
County and departmental policies are also reported.
The benefit to the County of the Fraud
Hotline is that investigations yield valuable information, not only for the
purpose of revealing misconduct, but also for the more valuable long-term
purpose of initiating discussion and analysis of needed corrective measures for
identified policy and procedural weaknesses.
Just as importantly, an investigative finding that a Hotline complaint
is without merit or is unsubstantiated serves to remove suspicion and doubt
regarding the integrity of an established process or an employee whose conduct
is in question.
From January 1,
2023, through December 31, 2023, the Fraud Hotline received a total of 520
allegations/complaints. They are
summarized as follows:
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• 25 new cases |
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• 11 insufficient
information/non-actionable items |
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• 484 cases referred out, consisting
of: |
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•199 referrals
to other appropriate County or non-County agencies, for allegations involving
issues other than fraud, waste or abuse by County employees and/or County
vendors. |
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•285 telephone
referrals for allegations not handled by the Fraud Hotline; for example,
Welfare Fraud calls are referred directly to the appropriate hotline number. |
Further, of the 25
new cases and 9 carry-over cases from prior years, 23 Fraud Hotline cases were
closed. Of these closed cases, claims in
8 cases were substantiated to be fraud, waste, or abuse and claims in 15 cases
were not substantiated.
Cases opened during 2023 included, among
other complaints, allegations of time abuse; HR policy violations; employee
misconduct; hostile work environment; theft of county resources; and conflict
of interest. There were multiple
allegations in several categories listed above.
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Calendar
Year: |
2020 |
2021 |
2022 |
2023 |
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New Cases Per Year |
26 |
18 |
20 |
25 |
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Items Referred Out |
300 |
258 |
319 |
484 |
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Insufficient Information/Non-Actionable Items |
24 |
7 |
5 |
11 |
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Total Hotline Allegations: |
350 |
283 |
344 |
520 |
FINANCIAL IMPACT:
N/A
STAFFING IMPACT:
N/A
ATTACHMENT(S):
Attachment A - Final 2023 Fraud
Hotline Annual Report