FORT ST. JOHN, B.C – Site C has yet to implement a fraud risk management program, according to a recent report released by the Office of the Auditor General of British Columbia.
In the audit, B.C.’s auditor general Michael Pickup says the Global Infrastructure Anti-Corruption Centre warns the risk of fraud increases with the size and complexity of large infrastructure projects, because it becomes harder to compare costs and detect corruption.
According to the report, BC Hydro must implement its new fraud risk policy, provide fraud risk management training, conduct regular fraud risk assessments, develop a fraud investigation procedure and regularly evaluate the fraud risk program effectiveness.
BC Hydro has accepted all recommendations made by the office, said the report.
Fraud risk management assesses fraud risks within an organization and then develops an anti-fraud program that stops this activity before it occurs.
“Enhancing existing risk management at Site C with robust fraud risk management could strengthen anti-fraud culture and benefit other projects,” Michael Pickup, auditor general, said. “It could also support BC Hydro’s reputation as a careful builder and provider of hydroelectric energy.”
The audit started in December 2014 and concluded in January 2022, and the audit report was released on April 26th, 2022.
The report mentioned that no fraud risk management responsibility was designated to any BC Hydro executive and that few employees have received any fraud risk management training.
The report states that BC Hydro does have a few fraud risk management elements already in place, such as a code of conduct policy, an ethics office and an anonymous reporting line.
The utility also has audit services to investigate fraud allegations related to accounting and auditing matters, but there is a risk that these elements may not be enough.
Before this audit, BC Hydro had not done any fraud risk assessments at Site C, and they drafted the first fraud risk assessment as this audit progressed, said the report.
The auditor general says that the absence of assessments increases the risk of overlooking possible fraud threats.
The Site C dam is the largest and most expensive infrastructure project in the province’s history, with a construction cost of $16 billion.
The full audit can be reviewed below:
With files from the Canadian Press
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