Reports of Misuse and Fraud

If an employee has reason to believe that NCSSM/State property or funds may have been damaged, lost or misused, they should notify Internal Audit or Campus Resources immediately. Depending on the circumstances involved, these concerns might also need to be reported to Human Resources, Legal Affairs and the Office of the State Auditor.

In accordance with NCGA 126-84 & 85, State employees are encouraged to report evidence of activities by employees of the State that include but are not limited to fraud, waste, or abuse of State resources. Further, all employees are protected from retaliation due to reporting any activity. At NCSSM suspected misuse can be reported anonymously using this e-form. The source of reports made in this manner will not be traceable. Reports can also be made in person at the Office of Internal Audit, by phone at 919-416-2797 or by emailing the Internal Auditor at internalaudit@ncssm.edu. Suspected misuse can also be reported anonymously via the NC State Auditors Hotline at 1-800-730-TIPS (8477).

The School is required to report all instances of known or suspected theft, embezzlement, or misuse of funds or property to the State Bureau of Investigation (NCGS 114-15.1). This process will be handled by the School’s Legal Affairs.

Investigation of Misuse

When Internal Audit receives information regarding potential misuse of public funds or property, they will conduct an initial review to determine if the allegations have merit and if further investigation by Internal Audit is necessary. While all reports will be given careful consideration and treated seriously, it is important to remember that allegations are unsubstantiated unless and until corroborating evidence is obtained. The initial review and any subsequent investigation will be conducted in a confidential manner and with respect for the rights of the individuals involved. Audit generally limits its investigations to situations involving loss or misuse of funds or other types of misuse that may have occurred due to a breakdown in controls. The goal of investigations if misuse is to:

• Determine if allegations of misuse are valid;
• Identify control weaknesses or breakdowns in procedure that allowed the situation and any related problems to occur;
• Determine the extent of any loss; and
• Recommend corrective action to prevent the situation form recurring.

When possible, Internal Audit will notify appropriate members of management prior to beginning an investigation. Advance notice may not be possible in rare situations when even a small delay could allow additional funds to be lost or records destroyed. In these situations, Internal Audit will notify management as soon as possible after the investigation begins. If allegations involve possible misuse by management, Audit will coordinate any investigation through an organizational level to which this area reports. The processes of conducting and reporting the results of a misuse investigation will be similar to the process followed for a routine audit. However, if the investigation reveals a potential violation of any federal, state, or local law, Internal Audit will refer the matter to Campus Resources and Legal Affairs for further review and action. Internal Audit will assist these entities with their reviews as needed.