Queensland Health needed to address deficiencies in its budgetary controls after one of its staff members exploited the holes to the tune of nearly $17 million over four years in a case of vendor fraud.
Vendor Fraud at Queensland Health
Between 2007 and 2011, Hohepa Morehu (Joel) Barlow used his position within Queensland Health’s finance branch to authorize $16.7 million in payments to a company registered in his own name and manually manipulated the department’s vendor master database to obscure the relationship, emphasizing the importance of implementing strong fraud detection and prevention solutions.
The organization outlined to iTnews its new and improved data matching process, which ensures any dodgy entries in its vendor database will be detected on a daily basis.
At the end of the business day, tables of vendor details are automatically stripped out of Health’s Finance and Materials Management Information System (FAMMIS), and ABNs and GST statuses are sent to the Australian Securities and Investments Commission to be verified against the official records.
The Solution: Anti-Fraud Software
Queensland Health has also deployed Alessa to process the comparison overnight, with any matches arriving in the email inboxes of the Vendor Master Team at the start of the next working day.
“In addition to the ABN check, automated checking is also performed daily for duplicate vendors (done on a weighting scale using an address, bank account, ABN, etc.), stale vendors, multiple blocking/unblocking of vendor status and multiple changes in bank accounts,” Mark Davey, CFO, said. “If the matter is not actioned after a period of time it will escalate to a more senior manager.”
Contact us today to learn how Alessa can help your organization with vendor fraud prevention and AML compliance software.
