ROUNDTABLE ON PROFESSIONAL ETHICS ANTI-FRAUD AND WHISTLE BLOWING MECHANISM

1. ROUNDTABLE ON PROFESSIONAL ETHICS ANTI-FRAUD AND WHISTLE BLOWING MECHANISM PRESENTER: MR RODERICK DAVIDS DIRECTOR: PROFESSIONAL ETHICS DATE: 15 MARCH 2011 VENUE: BURGERS PARK HOTEL

2. Outline of the Presentation • Introduction • Objectives • Contact details • Cases of alleged corruption received • Cases of alleged corruption referred to departments • Outcome of investigations • Challenges and recommendations • New developments

3. Introduction • Since its inception, the PSC has been at the forefront of promoting anti-corruption initiatives in the Public Service. • The PSC has to coordinate the activities of the National Anti-Corruption Forum (NACF), a cross-sectoral forum established in the fight against corruption. • The NACF is the national blueprint outlining the role of all sectors and was developed on realization that the war against corruption can only be through a multi-pronged, collaborative and all-inclusive approach. • The PSC has promoted professional ethics and has also been directly involved in the management of initiatives to prevent corruption in the Public Service. • Such initiatives include the Financial Disclosure Framework for senior managers through which potential conflicts of interest are managed.

4. Introduction (Cont’d) • Cabinet approved a single National Anti-Corruption Hotline (NACH) on 14 August 2003. • In terms of the Cabinet’s direction, the NACH was assigned to the PSC and cases of alleged corruption reported are referred to Departments for investigation. • The PSC is required to investigate certain categories of cases of alleged corruption i.e. face to face interviews with the whistleblowers, high profile cases involving heads of Departments, etc. • The purpose of the NACH is to serve the public service as a whole as opposed to a decentralized system. • The NACH caters for: • National Departments • Provincial Departments • Public Bodies and Entities

5. Introduction (Cont’d) • Anti-Corruption Hotlines in Departments were phased out due to inconsistencies, ineffective and duplication of human and financial resources. • These Anti-Corruption hotlines were operated at a cost of over R80 million per annum to Government. • The management of a single anti-corruption hotline for the Public Service is currently operated at a cost of approximately R2 million per annum. • The NACH is accessible to the public regardless of where they may be in the country, 24 hours per day and 11 official languages are catered for.

6. OBJECTIVES The objectives of the NACH are to: • deter potential corruption by making all employees and other stakeholders aware that the Public Service is not a “soft target”; • detect incidents of corruption through encouraging whistle blowers to report incidents which they witness occurring in the Public Service; • assist the Public Service in identifying areas of corruption risk in order that preventative and detective control measures can be appropriately improved or developed; and • enable callers to report corruption anonymously thus encouraging whistle- blowing.

7. Contact details • By phone: 0800 701 701 toll free number • In person ‘walk in disclosures” • By SMS facility: Send the SMS to 39772 at a cost of R1.00 per SMS. • By Website: www.publicservicecorruptionhotline.org.za • E-mail : integrity@publicservicecorruptionhotline.org.za • By post: P.O. BOX 582, Umhlanga Rocks 4320, KwaZulu Natal, 4320 • Fax 0800 204 965

8. Cases of alleged corruption received • The PSC assesses corruption reports. • Pursuable corruption reports are referred to departments and public entities for investigation. • Non-pursuable corruption reports are submitted to the PSC to decide on closure or referral to departments. • Urgent cases are referred within 24 Hours. • 419 scams are referred to Interpol for investigation. These cases are closed on the Case Management System of the NACH.

9. Investigation by Departments • Departments investigate referred cases of alleged corruption with a view to report back to the PSC. • Where necessary cases may be referred to an appropriate agency for investigation. • All investigations must be executed as speedily as possible(40 days feedback to the PSC). • Full investigation reports should be submitted to the PSC in order to evaluate the cases and capturing them on the CMS. • Progress reports must include: cases investigated, prosecution, non prosecution, conviction/ recovery of money or disciplinary steps taken. • Status report should be submitted on a regular basis

10. Since the inception of the NACH, 01 September 2004 to 31 July 2010, a total of 7794 cases were referred to Departments. Cases of alleged corruption referred to departments

12. Cases of alleged corruption referred to departments • The number of cases received during 2008/2009 financial year were 1857 whilst during 2009/2010 financial year the NACH received 1401 • The NACH received over 1000 cases of alleged corruption in each financial year. This is because of the strong marketing of the NACH: • Advertisement of the NACH in the Media • Increased willingness of citizens to report alleged corruption • Events of corruption reported in the media that draws attention to corruption • An increase in the actual extent of corruption

13. Provision of feedback to the PSC • The NACH only received feedback on 31% of all cases referred to departments. • Feedback declined in 2007-2008. • There is poor coordination of cases with regard to the referral of cases from the Offices of the respective Directors-General to the relevant provincial departments. • This causes delays in providing feedback to the PSC. • The slow feedback by departments is impacting negatively on the credibility of the NACH.

14. South African Police Service • 357 cases of alleged corruption were received and referred to SAPS for investigation. • Feedback was received on 179 or 50% cases; and • Out of these cases, 120 or 34% cases were closed on the Case Management System of the NACH by the PSC. • 322 cases of alleged corruption against police officials were referred to the ICD for investigation, 175 feedback was received and 110 cases are closed on the CMS by the PSC

15. Types of allegations reported to the NACH as at 31 JULY 2010

16. Outcome of investigations • The successful investigation of cases resulted in the recovery of R110 million from perpetrators; • As a result of the successful investigation of cases, over 1400 officials were found guilty of misconduct due to corruption;

17. CHALLENGES • Slow rate of feedback due to a lack of capacity and accountability by senior managers to deal effectively with NACH cases. • Only 1461cases of alleged corruption were closed on CMS after investigation. • Adequate financial and human resources are not allocated to combat and prevent corruption by departments and their political principals. • Problems experienced by departments in the handling of NACH cases appears to be linked to the lack of investigative capacity and • the fact that departments do not have appropriate structures or specialized units to deal with cases of alleged corruption as required by the Minimum Anti-Corruption Capabilities set by Cabinet • there seems to be lack of will/reluctance to investigative cases by departments and lack of investigative capacity therefore is used as an excuse

18. Recommendations • Provinces must review their referral protocols • Minister for the Public Service and Administration should issue regulations on the Management of the Hotline • Departments should create Forensic Investigative Capacity • Provinces must establish Integrity Management Units to deal with investigations • Departments should commit themselves in dealing with abuse of GG vehicles, abuse of school funds and social grant fraud • PSC must install the Web Enabled System • Departments must conduct risk assessments on corruption • Departments must ensure proper coordination of cases

19. Current developments • Web Enabled Technology has been developed • The Web Enabled System for case referrals to departments will be installed at the PSC during 2010/2011 financial year (to be piloted May 2011) • The PSC will commence the process with a pilot phase that will include: Correctional Services, Gauteng and Mpumalanga Provincial Administrations

20. THANK YOU!