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Welcome to the 2009 Regence Internal Fraud Risk Assessment!
As leaders, we share the responsibility to protect our members’ assets and Regence’s assets. Our financial statement audits and NAIC regulations require us to periodically assess the risk of fraud and analyze how we are mitigating those risks. That’s the purpose of this assessment: to help us identify ways in which we may be vulnerable.
To start your wheels turning, we’re giving you an example of the kind of internal loss that companies can suffer. In light of your knowledge of your processes, systems, and people, please consider whether anything like that could happen in your area. If so, please tell us how.
This isn’t a conventional survey. It’s not anonymous, as that would defeat the purpose of identifying where we may be vulnerable. And by and large, we’re asking you to write out short answers instead of picking multiple choice selections. But we estimate that the survey will take no more than 10 minutes, and if you’d like to talk to one of us, there’s an option for you to let us know.
Thank you for everything you do to protect Regence and its members. We appreciate you.
The Internal Fraud Prevention and Corporate Integrity Team
Bob Goetz, Regence Information Technology Services
Alex Johnson, External Audit
Rosemary Reeve, Legal Special Services
Randy Romrell, Ethics & Compliance
Stacy Simpson, Financial Accounting Services
Mark Stimpson, Human Resources
Anjie Vannoy, Internal Audit |
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What does our Code of Business Conduct say about preventing fraud?
Fraud
Fraud occurs when someone uses deception to obtain an advantage or avoid a loss or obligation. It can happen inside or outside the company, and it can involve anyone: members, providers, employees, contractors, groups, agents, or suppliers.
Examples:
Employees, contractors, or suppliers who misrepresent the status of a project.
Providers who bill inappropriately.
Employees who obtain confidential information about members or colleagues to use for unauthorized purposes.
When fraudulent behavior impacts Regence, we need to know about it so we can take steps to address it. Report external issues (such as providers who are billing inappropriately) to the External Audit and Investigation Department. Report internal fraud issues to Ethics and Compliance. If you are not sure whom to call, contact an ethics and compliance officer.
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One Example of Potential Fraud:
Embezzlement
During the past year, we’ve seen many national scandals involving embezzlement. As you think about Regence’s vulnerability to embezzlement, consider the flow of funds through the company and your division/department’s ability to divert those funds in any way. Examples of potential problems include:
o Submitting false claims for oneself or a confederate.
o Creating a false provider, supplier, vendor, employee, member, or contractor.
o Forging checks, contracts, or purchase orders.
o Receiving a kickback from a vendor or agent in exchange for a favorable decision.
o Skimming from accounts receivables.
o Submitting false or inflated expense report or time cards.
We understand that every manager with employees runs the risk of receiving false or inflated expense reports or time cards – and has the responsibility to review them diligently to detect any problems.
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| Aside from inflated expense reports or time cards, does anyone in your division/department have the ability to embezzle funds from the company? |
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| Who has this ability? (by name or position) | | |
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| What red flags are in place that would alert you if someone was embezzling? | | |
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| What additional red flags could be implemented to identify embezzlement? | | |
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| What steps have you taken to prevent or mitigate the opportunity for embezzlement? | | |
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| What additional steps could be taken to prevent or mitigate the opportunity for embezzlement? | | |
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| If you are aware of embezzlement vulnerabilities outside your division, please let us know. | | |
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| Other than the ones already discussed, are you aware of any current risk of internal fraud? |
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| Other than the ones already discussed, are you aware of any current or past situation in which an employee or contractor tried to obtain an advantage or avoid a loss or obligation by means of deception? |
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| Do you know how to report a concern about internal fraud? |
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| How would you report a concern about internal fraud? |
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| Would you like to discuss an answer to any of the questions above? |
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| At what number should we contact you? | | |
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| What is the best time for us to contact you? (Please include AM or PM, and time zone) | | |
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| What would you like to discuss? | | |
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