2009/12/18 City Council Resolution 2009-135RESOLUTION N0.2009 -135
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ROHNERT PARK
ADOPTING A FRAUD IN THE WORKPLACE POLICY
WHEREAS, the City's external auditor, Odenberg, Ullakko Muranishi & Co. LLP, has
recommended as a best practice that the City develop an anti -fraud policy, which defines acts of
fraud, establishes that fraud in the workplace will not be tolerated and outlines the consequences
of workplace fraud;
WHEREAS, the City's external auditors further recommended that this policy be
acknowledged and signed by each employee /volunteer as evidence that the employee /volunteer
has received and understands the policy; and
WHEREAS, staff has prepared a Fraud in the Workplace policy that outlines acts that
are considered fraudulent, the steps to be taken when fraud is suspected, and the procedures to be
followed in accounting for missing funds, restitution and recoveries.
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Rohnert
Park adopts and directs City staff to implement the City of Rohnert Park Fraud in the Workplace
Policy attached as Exhibit "A."
DULY AND REGULARLY ADOPTED by the City Council of the City of Rohnert
Park this 18t` day of December, 2009.
ATTEST:
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CITY OF ROHNERT PARK
LIM114 -
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BELFORTE: AYE BREEZE: AYE CALLINAN: AYE MACKENZIE: ABSENT STAFFORD: AYE
AYES: (4) NOES: (0) ABSENT: (1) ABSTAIN: (0)
EXHIBIT A
City of Rohnert Park
PERSONNEL PROCEDURES
Effective Date:
Approved by:
Legal Review by:
Subject: Fraud in the Workplace
I. PURPOSE
To establish policy and procedures for clarifying
fraudulent, describing the steps to be taken 4
dishonest activities are suspected, and providii
accounting for missing funds, restitution and reco,
II. PERSONS AFFECTED
All City of Rohnert Park Eployees (
III. POLICY
A. - STA
are considered to be
aid or other related
dares to follow in
The City of Rohnerte Park ( "the City')„ is committed to protecting its assets
against .the rack of loss or misuse. Accordingly, it is the policy of the City of
Rohnert Park to identify aid promptly investigate any possibility of fraudulent
o related dishonest< activities 'against the City and, when appropriate, to
pursue legal remedies available under the law.
SCOPE
s policy applies to any actual or suspected fraud, waste or abuse of
)urce§Jgvolvmg the City employees. Any investigative activity will be
ducted "without regard to the suspected wrongdoer's length of service,
ition/title or relationship to the City.
C. DEFINITIONS
1. Fraud — an act committed by one whom, by deceit, falsehood, or other
fraudulent means, defrauds the public or any person of any property,
money, or valuable security or any service. Fraud, as used herein,
and other similar irregularities, refer to, but are not limited to the
following:
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a. Claim for reimbursement of expenses that are not job - related or
authorized by the current Memorandum of Understanding.
b. Forgery or unauthorized alteration of documents (checks,
promissory notes, time sheets, independent contractor agreements,
purchase orders, budgets, etc.).
c. Misappropriation of City assets (funds, securities, supplies,
furniture, equipment, etc.).
d. Improprieties in the handling or
e. Authorizing or receiving payment
services not performed.
f. Computer- related activity lnvolving
destruction, forgery, or manpulatioi
City -owned software.
g. Misrepresentation of
h. Any apparent violation of. Federal,
dishonest activities or fraud =:y
transactions.
received or
uthorized alteration,
data or misabnronriation of
laws related to
i. Seeking or accepting anything of material value from those doing
business v th the City 'including vendors, consultants, contractors,
lessees, applicants, and grantees. Materiality shall be determined
m aecordance with the City's Conflict of Interest Code, which
incorporates Title'O California Code of Regulations Section 10730,
adonted°by- he Fair Political Practices Commission.
2. Employee - anyY,i dividual employed by the City of Rohnert Park,
either onmull or part-time status, whether or not compensated.
Mana eg_inent — any administrator, manager, director, supervisor, or
other:ndividual who manages or supervises funds or other resources,
including human resources.
4. Internal Auditor — any person or persons assigned by the City
Manager to investigate any fraud or similar activity on a case by case
basis.
5. External Auditor — independent audit professionals who perform
annual audits of the City's financial statements.
6. Bad Faith Complaint — a complaint made with malicious intent.
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7. Retaliation — unlawful discrimination that occurs when an employee
is harassed or suffers an adverse employment action for assisting in
an investigation of unlawful or fraudulent employment practices.
Also referred to as unlawful retaliation or retaliatory harassment.
IV. PROCEDURES
A. REPORTING FRAUD IN THE WORKPLACE
Employees shall report all instances of suspected fraud. Employees may do
so by speaking with their direct supervisor. If the employee believes that the
supervisor may be involved in the fraud or similarly inappropriate activity, or
if there is any other reason the employee believes it would not be appropriate
to report to the supervisor, the employee shall make the report directly to the
next higher level of management andloflo the City Manager
B. ANTI- RETALIATI.ON STATEMENT
No employee shall retaliate against another emplo
pursuant to this policy. Employees found to have=
subject to disciplinary action: do ;and including
C. INTERNAL CONTROLS
who reports an incident
ated this section may be
ONS
Each department of the City is responsible for instituting and maintaining a
system= of internal control to provide reasonable assurance for the prevention
and detection of fraud;Rmisappropriations,.and other irregularities in their
department. ManagementAshould'be familiar with the types of improprieties
that might occur within their area of responsibility and be alert for any
s the City's intent to fully investigate any suspected acts of fraud,
misappropriation or other similar irregularity. An objective and impartial
investigation wil -1 be conducted regardless of the position, title, length of
service or relationship with the City of any party who is suspected of fraud.
An overview of the investigations process is as follows:
The Internal Auditor, in conjunction with the City Attorney, has the
primary responsibility for the investigation of all activity as defined in this
policy.
2. Throughout the investigation, the Internal Auditor will inform the City
Manager of pertinent investigative findings.
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3. Upon conclusion of the investigation, the results will be reported to the
City Manager.
4. The City Manager, following review of investigation results, will take
appropriate action regarding employee misconduct. If the investigation
substantiates that fraudulent activities have occurred, disciplinary action
may include termination in accordance with the City's Personnel Policies
and Procedures or Memorandum of Understanding (as applicable) and
referral of the case to the District Attorney's Office, or other appropriate
law enforcement agency for possible prosecution. Decision to prosecute
and/or refer any investigation results to the District Attorney's Office or
other appropriate law enforcement agency will be made in conjunction
with the City Attorney, as will final decision on disposition of the case.
5. The City may pursue every available legal remedy, ineluding court-
ordered restitution, to recover City ;losses from the offender„ ,or other
appropriate sources.
D. RIGHT TO RESPOND
A person under investigation for f
essential particulars of the alle -W
investigation. Where notice is ,,giN
being made may submit a written
investigated to the Internal Audit'
notice is received The Internal A
submitted hereunder as part of the
may schedulenterviews.with a pc
necessary.
is to be'given notice in writing of
)rior to the conclusion of the.
he person against whom allegations are
ination`concerning such matters being
later than seven calendar days after
►r shall consider any written explanation
stigation record. The Internal Auditor
under investigation for fraud as
and Commissioner. Responsibilities
If the Mayor, a City Council member, or a Commissioner has reason
to suspect that fraud has occurred, he or she shall immediately contact
the City Manager.
2. The Mayor, City Council member, or Commissioner shall not attempt
to investigate the suspected fraud or discuss the matter with anyone
other than the City Manager.
3. The alleged fraud or audit investigation shall not be discussed with.the
media by any person other than through the City Manager in
consultation with the City Attorney and the Internal Auditor.
B. Management Responsibilities
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1. Management is responsible for being alert to and reporting to their
immediate supervisor any fraudulent or related dishonest activities in
their areas of responsibility.
2. Each manager should be familiar with the types of improprieties that
might occur in his or her area and be alert for any indication that
improper activity, misappropriation, or dishonest activity is or was in
existence in his or her area.
3. When an improper activity is detected or, su's'pected, management
should determine whether an error or mistake has occurred or if there
may be dishonest or fraudulent activity:.
4. If management determines a suspected' activity may involve fraud or
related dishonest activity, they should contact their immediate
supervisor. Department Dirs should, inform the City Manager.
ector
5. Management should not attempt to conduct individual investigations,
interviews, or interrogations. However, management is responsible for
taking appropriate corrective actions 04ensure adequate controls exist
to prevent recurrence of ir�per actions
6. Management shall support the City Manager's responsibilities and
cooperate fully with the Internal"' Auditor and other involved
departments, ,end law enforcement agencies in the detection, reporting,
and investigation of crimi� acts, including the prosecution of
L to ` ;applicable federal, state and local laws governing
itiality, management, in conjunction with the City Attorney's
;hall provide access to all necessary records and personnel in
ton with any City investigation of fraudulent activities.
.,rig with suspected dishonest or fraudulent activities, great care
taken. Therefore, management should avoid the following:
a. Incorrect accusations.
b. Alerting suspected individuals that an investigation is
underway.
c. Treating employees unfairly.
d. Making statements that could lead to claims of false
accusations or other offenses.
9. In handling dishonest or fraudulent activities, management has the
responsibility to:
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C.
a. Make no contact (unless requested) with the suspected
individual to determine facts or demand restitution. Under no
circumstances should there be any reference to "what you did ",
"the crime ", "the fraud ", "the misappropriation ", etc.
b. Avoid discussing the case, facts, suspicions, or allegations with
anyone outside the City, unless specifically directed to do so by
the City Attorney.
c. Avoid discussing the case with anyone inside the City other
than employees who have a need, to know such as the City
Manager, Internal Auditor, City Attorney, or law enforcement
personnel. "j
d. Direct all inquiries from the suspected mdividual, or his or her
representative, to the City Manager or City", Attorney. All
inquiries by an attorney of the suspected individual should be
directed to the City Attorney All °inquiries from the media
should be directed to the Citv,,Manager.
e. Take appropria and disciplinary action, up to and
including dismj sal, after consultiq with the City Manager, in
accordance with the Cty`s4 P�erso "nel Policies and Procedures
otMeMorandum Wnderstanding (as applicable).
City Manager, the Internal Auditor will
y mvestigate the
2. In all :circumstances where the City Manager determines there to be
.�
reasonable grounds for suspecting that a fraud has taken place, the City
Manager,may direct the Internal Auditor, in consultation with the City
Attorney `to contact the Rohnert Park Public Safety Department.
3. T,h Internal Auditor may be authorized to receive relevant,
confidential information to the extent allowed by law, as determined
by the City Manager and the consultation with the City Attorney. The
Internal Auditor shall take all necessary steps to maintain the
confidentiality of such information.
4. If evidence gathered by the Internal Auditor substantiates a finding of
possible dishonest. or fraudulent activities, the Internal Auditor will
proceed as follows:
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to a
a. Discuss the finding with management and the Department
Director.
b. Advise management, if the case involves staff members, to
meet with the City Manager (or his/her designated
representative) to determine if disciplinary actions should
be taken.
c. If directed by the City Manager, report to the External
Auditor such activities in order to assess the effect of the
illegal activity on the City's financial statements.
d. If directed by the City Manager; ;coordinate with the City's
Risk Management regarding notification to insurers and
filing of insurance claims.
e. Take immediate action, ih,. , consultation with: 'the City
Attorney, to prevent ;the theft; alteration, or destruction of
evidentiary records. Such:- action shall include, but is not
i. Removing the records and .placing them in a secure
location. or hmitina access to the location where the
Prevenifti the individual suspected of committing
the fraud from having access to the records.
j,s contacted by the media regarding an alleged
ration, the Internal Auditor will consult with the
City Attorney, as appropriate, before responding
information or interview.
At the conclusion of the investigation, the Internal Auditor will
=document' the results in a confidential memorandum report to the City
Manager and the City Attorney. If the report. concludes that fraud has
occurred, the City Manager, in consultation with the City Attorney,
may authorize the report to be forwarded to the Rohnert Park Public
Safety Department.
7. The Internal Auditor will be required to make recommendations to the
appropriate department for assistance in the prevention of future
similar occurrences.
8. Upon completion of the investigation, including all legal and personnel
actions, all records, documents, and other evidentiary material,
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obtained from the department under investigation will be returned by
the Internal Auditor to that department.
D. Employee Responsibilities
1. A suspected fraudulent incident or practice observed by, or made
known to, an employee must be reported to the employee's supervisor
for reporting to the proper management official.
2. When the employee believes the supervisor may be involved in the
inappropriate activity, the employee shall make the report directly to
the next higher level of management and/or the City Manager.
3. The reporting employees shall refrain four further„ investigation of the
incident, confrontation with the alleged 'violator, or further discussion
of the incident with anyone, unless requested by the, City Manager,
Internal Auditor, City Attorney or law enforcement personnel:
4. Any employee who makes a Bad Faith Complaint and/or any report
under this policy which the employee knows or has. reason to believe is
false shall be subje6ft disciplinary action, including but not limited to
termination, as determine "cby� City Manager.
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