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December 18, 2018

Lessons Learned from the City of Sacramento

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We came across an article titled “When city workers request fraudulent reimbursements, it’s buyers beware,” by Graham Womack, published on www.newsreview.com. The article gave details about some of the 85 tips that the city of Sacramento received from an anonymous whistle-blower hotline between April 1 and September 30. The most notable tip told the city about fraudulent activity conducted by the Department of Utilities employees. These employees collected $5,000.00 by submitting fraudulent receipts in search of reimbursement for personal protective equipment. The problem was resolved with the firing of eight employees. According to the article, other lower priority tips informed the city about issues such as a city employee advertising a personal business through electronic city resources. Without the use of the anonymous hotline, these problems would have most likely gone unnoticed until they became more severe.

Multiple constituents praised the existence of a hotline. They realized its proven potential to limit criminal activities. Not only did the hotline allow people to speak out against unacceptable behavior, it also served as a reminder to abstain from illegal activities. The article quotes the city auditor, Jorge Oseguera, who commented, “‘It makes [employees] question whether to engage in those things in the first place.’” There are three lessons that we can take away from this article:

  1. Having an anonymous whistle-blower hotline allows people to speak up against unethical behavior. Without a hotline, people may be hesitant to report cases. They may fear retaliation or be concerned that they are creating a problem where one doesn’t already exist. Having a hotline empowers people to report a tip in good faith.
  2. The implementation of a hotline makes employees less likely to engage in unethical behavior. The presence of a hotline means that it is easier to report this behavior. If employees believe that they are likely to get caught, they will most likely stay in line.
  3. Having a hotline increases the credibility of your organization. The article quotes Councilman Steve Hansen of Sacramento stating, “‘[the hotline] has yielded, I think, a greater trust knowing that there’s a place for people to anonymously report tips.’”
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Filed Under: Ethics, Fraud Prevention, Fraud Reporting

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