Protect your NFP organisation from fraudulent activities

Not for Profit organisations are known for their passion and charity, with the company kept alive from generous donations from the public. Each not for profit organisation has their own purpose and vision, however amongst these kind intentions, there are individuals who have other ideas.

In the lead up to ANZAC Day commemorations, the federal government has launched an investigation into Camp Gallipoli amid claims of financial dishonesty.

Camp Gallipoli runs ANZAC Day eve camp-out events in various locations to learn about the experiences of diggers and promises to donate any surplus funds to the Returned and Services League and Legacy Australia, however both parties have claimed they have not received a single cent from Camp Gallipoli.

Chief Executive of Camp Gallipoli, Chris Fox, has denied claims of financial mismanagement, stating that high costs and had weather led to no money left over from the nationwide camp-out event, which ran for the first time in 2015, to forward onto the charities.

Ken Foster from the Vietnam Veterans Association of Australia is concerned that these reports may impact on future fundraising activities as the problem for charities claiming to raise money for veterans then not passing it to the charity was not a new occurrence.

“If people are really trying to raise money for a good cause, they don’t then make sure that their management fees come out first.”

Fraud has the potential to impact your organisation financially and affect the reputation, prospects, sustainability and morale of all stakeholders.

Another case from 2010 reported the former Director of Family Connections, Louanne Aponte, allegedly used her position to steal more than $300,000 from approximately 32,000 families with childcare support and resources and inappropriately deposited the funds into her own bank accounts. Her alleged crimes also included the manufacturing of fake audit reports to obtain government and state contracts and developing a company to which she regularly issued cheques and later using the money to finance large purchases, including a $53,000 Mercedes-Benz convertible, a ski boat and a $300,000 home.  

To minimise the risk of fraud within the organisation and to maintain your reputation within the community, proper controls and careful monitoring of fraud risk potentials, including:

• Failure to segregate duties
• Failure to conduct a proper background check before employment
• Failure to confirm the auditing agency’s activity

Although the situation was unfortunate for the company, however it serves as an important lesson for other Not for Profit organisations on how they can manage and reduce the risk of fraudulent activities, such as:

• Know your employees
• Limit power
• Increase accountability
• Promote communication and education

The best methods to prevent fraudulent behaviour is to the defend a business’s account before they are breached and this is applies in particular to Not for Profits, otherwise, the biggest victims are the ones who need help the most. 

For more information on how to protect your organisation against internal fraud, attend the upcoming 5th Annual Australian Fraud Summit 2016 on the 24th and 25th of May. This conference has attracted delegates from across Australia and Asia Pacific.

Being brought up in a typical Chinese family in Australia, Vivian takes pride as an ABC (Australia-born Chinese) where she happily embraces both the Chinese and Australian cultures. 

In high school, Vivian wanted to become a fashion designer, however she has developed a passion for running events after working backstage for multiple live shows. Prior to starting at Akolade, Vivian worked 4 years in the wine industry and she misses the wine tasting sessions and openly drinking on the job. As the Marketing Coordinator, Vivian enjoys using her creativity to design unique and fun campaigns for each event. In her spare time, Vivian loves to spend time with her two adorable pets; a cat and a dog.