Chapter 2: Fraudulent or Dishonest Activities
University of Texas System policy dictates that all suspected fraudulent or dishonest activities, including but not limited to embezzlement, misappropriation, or other fiscal irregularity, should be reported immediately and investigated by the appropriate University departments. University Administration is responsible for establishing and maintaining internal controls which provide reasonable assurance that improprieties are prevented and detected. Each department should be familiar with the types of improprieties that might occur in their areas, and be alert for any indication that such an act has occurred.
2.1 Dishonest or Fraudulent Activities
Dishonest or fraudulent activities concern any illegal, dishonest, or fraudulent acts involving University property or resources. Examples of such activities include but are not limited to: embezzlement, misappropriation, or fiscal irregularities; forgery or alteration of checks, drafts, or securities; forgery or alteration of employee benefit or salary-related items such as time cards, billings, claims, or changes in beneficiary; forgery or alteration of medical-related items such as reports, charts, prescriptions, x-rays, billings, or claims; forgery or alteration of student-related items such as grades, transcripts, loans, fees, or tuition documents; misappropriation of funds, securities, supplies or any other University asset for private gain (e.g., equipment used for private consulting work, personal long-distance calls made on University telephones); illegal or fraudulent handling or reporting of money transactions; acceptance or solicitation of any gift, favor, or service that might reasonably tend to influence the employee in the discharge of his or her official duties; destruction or disappearance of records, furniture, fixtures, or equipment where theft is suspected.
2.2 Coordination of Investigations
The Office of Auditing and Consulting Services (OACS) will supervise all investigations of allegations of dishonest or fraudulent activities. When an investigation reveals suspected criminal activity or is initiated due to an allegation of criminal activity, the University Police are to be notified immediately. The Director of Police for The University of Texas System (U.T. System) should be made aware of all felony fraud investigations, and will be informed of the progress of investigations conducted by the University Police.
If an investigation reveals activity that may constitute a felony offense, the Chief Audit Executive for OACS shall immediately notify the Chief of Staff and the Vice President for Business Affairs. If related to faculty, the Provost and Vice President for Academic Affairs shall also be notified immediately. In any circumstance involving a potential felony offense, timely notification will be given to the U.T. System Chief Audit Executive.
In accordance with Regents' Rule 80601, the Vice President for Business Affairs shall notify the U.T. System Chief Compliance and Risk Officer, or designee, as soon as it is known that a loss has occurred, for approval of all insurance and fidelity bond claims. It is the responsibility of the Vice President for Business Affairs to notify the President, who advises the Executive Vice Chancellor for Business Affairs, of criminal activity, as appropriate.
All reasonable assistance will be provided to law enforcement agencies when requested. OACS, the University Police, the Vice President for Business Affairs, and Office of Legal Affairs will coordinate assistance provided to state, federal, and local law enforcement agencies. Where appropriate, the U.T. System Office of General Counsel may also assist. For investigations conducted by Auditors of federal or state agencies, all requests for information and assistance must be forwarded immediately to OACS, who will consult with the Chief of Staff and the Vice President for Business Affairs.
The Vice President for Business Affairs may receive information on a confidential basis, to the extent permitted by law. Employees and students may directly contact the Vice President for Business Affairs whenever an activity is suspected to be dishonest or fraudulent. Individuals who report suspected activity should not attempt to personally conduct investigations, interviews, or interrogations with regard to the reported activity.
2.3 Integrity of Investigations
Reviews conducted by OACS as part of their yearly audit plan, or any investigations which reveal violations of the Penal Code for which an investigation report will be issued, should be reduced to final report form only after consultation with the Chief of Staff, the Vice President for Business Affairs, the Office of Legal Affairs, and where appropriate, the U.T. System Office of General Counsel.
The University Police will coordinate any criminal investigations if probable criminal activity is detected.
Reporting individuals should not discuss the investigation with anyone, unless specifically directed to do so by the OACS, the University Police, or the Office of Legal Affairs. All inquiries from the suspected individual or his/her representative or attorney must be directed to the Vice President for Business Affairs.
When an investigation initiated due to an allegation of criminal activity fails to detect criminal activity, and when advised by the Office of Legal Affairs, the Chief Audit Executive has the discretion to stop the investigation.
2.4 Findings of Investigations
Each investigation of possible dishonest or fraudulent activity has the potential to provide insight into specific activities, and may reveal control weaknesses or other issues that require further investigation, audit, or University Administration attention.
Each investigation will be reviewed by OACS to determine whether additional work needs to be done in order to provide the Internal Audit Committee and University Administration with a basis for taking corrective action, if necessary.
Allegations or issues found to involve scientific misconduct will be handled in accordance with UTS 118 and HOP Section IV, Chapter 6, Research Integrity Policy.