Bob Mackin
Fraud was detected within the last year at 61% of the B.C. government organizations polled by Auditor General Michael Pickup.
Michael Pickup, B.C.’s new auditor general (Nova Scotia)
The most common incidents were theft of physical assets (43%), misappropriation of company funds (22%) and information theft, regulatory or compliance breach and internal financial fraud (17% each).
Pickup’s staff surveyed 23 organizations representing 86% of government assets for the Fraud Risk and Financial Statements: B.C. Public Sector, Part 1 report, which was published March 7.
“Fraud is a lot more than stealing money or cash out of the drawer,” Pickup told reporters. “There’s many facets to what constitutes fraud. So we have to think of fraud in that broader context.”
Pickup found more than two in 10 organizations polled had not assessed the need for fraud risk management training for staff and 9% had not assigned a senior manager to oversee fraud risks. More than a third did not have a dedicated fraud risk management policy and almost four in 10 organizations did not have ways and means of identifying and documenting fraud risks.
The Office of the Auditor General asked Crown corporations, agencies, universities, health boards and school boards to self-report. They ranged from B.C. Housing, B.C. Lottery Corporation and B.C. Liquor Distribution Branch and BC Hydro to the Burnaby and Surrey school boards, University of B.C., Vancouver Coastal Health Authority and Community Living B.C.
A similar survey gauging fraud risks in ministries is forthcoming, Pickup said.
Pickup’s report, however, did not name names.
“There are findings in here that organizations can look at and say, okay, why aren’t we doing this? Does this make sense that we’re not doing it? Here’s what other organizations may be doing,” Pickup said.
B.C. Legislature.
Pickup found that one organization had no fraud risk management policies at all, while another said it did not have all incidents of fraud and corrective reviewed by senior executives and senior management.
The report also did not mention any specific incidents.
Pickup’s office is the auditor for five of the 23 organizations polled. One of those is the Provincial Health Services Authority, which employed a fake nurse at B.C. Women’s Hospital in 2020 and 2021.
Brigitte Cleroux was charged in late 2021 with fraud over $5,000 and personation with intent. She is serving a seven-year jail sentence in Ontario.
Pickup’s office also audits BC Hydro. In April 2022, he found the NDP-appointed board did not formally assess the potential for fraud at the $16 billion Site C dam project until after his staff began to investigate.
The Tuesday-released survey did not include the Legislative Assembly. Disgraced former clerk Craig James was convicted last May of fraud and breach of trust for using taxpayers’ money to buy personal clothing. He was sentenced to a month of house arrest followed by two months under curfew.
Also not included was the Ministry of Children and Family Development. Former social worker Robert Riley Saunders was jailed for five years in 2002. He used a fraudulent university degree to get the job and then deprived Indigenous clients of $460,000.
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