I. Purpose
North Carolina General Statute 143B-920, requires state agencies to report, in writing, all incidents of attempted arson, arson, damage, theft, embezzlement or misuse of state owned property to the State Bureau of Investigation (SBI). The purpose of this policy is to recognize this legal requirement, to define the process for ensuring complete compliance with this law, and to ensure that appropriate investigations are conducted.
II. Scope
By law, all employees are required to report all suspected incidents of theft, damage or misuse of state owned property, regardless of the dollar amount involved. The Public Safety Department will coordinate with the Director of Internal Audit and report all applicable instances to the SBI.
III. Policy
All instances of attempted arson or arson, damage, theft, embezzlement or misuse of state owned property will be reported to the State Bureau of Investigation (SBI) and investigated in a timely and appropriate manner.
IV. Procedure
In cases of arson, damage, theft, and embezzlement of state property, the evidence is typically obvious and should be reported immediately. However, in cases of suspected misuse, the circumstances are often clouded and may not be as they appear. Employees must exercise common sense and good judgment when determining if a particular event is likely a misuse of state property and should be reported.
Employees receiving viable information or evidence of attempted arson, arson, intentional damage, theft, embezzlement or misuse, of state owned property, should report such incidents to their immediate supervisor and to Public Safety as soon as possible, but not later than three days after receiving the information. Depending on the circumstances, such allegations may, instead, be reported directly to Public Safety, the Director of Internal Audit, the Director of Human Resources, the Employee Relations Manager or the Office of the State Auditor. Reports may also be made anonymously to the Director of Internal Audit (CPO 1475), to the Office of the State Auditor at 800.730.8477, or via the Fraud Report Form.
All departments receiving reports of suspected damage, theft or misuse of state owned property must report the matter to Public Safety. In turn, Public Safety will log the incident in their computer system, assign a case number, and complete a State Property Misuse Report (form SBI-78) for the incident. Public Safety will then forward all State Property Misuse Reports to the SBI’s Professional Standards Division within 10 days of receiving a report. A copy of all misuse reports will be retained and filed in accordance with state record retention guidelines. Public Safety will also submit data on all criminal investigations cases to the SBI’s Uniform Crime Reporting Section on a monthly basis.
Public Safety will submit a monthly listing of all incidents involving state owned property to the Director of Internal Audit for his/her review. Internal Audit generally limits its investigations to situations involving loss or misuse of funds or other types of misuse that may have occurred due to a breakdown in internal controls. The goal of such investigations is to determine if the allegation of theft or misuse is valid and then to identify control weaknesses or breakdowns in procedure that allowed the situation to occur, determine the extent of any loss, and recommend corrective action to prevent the situation from recurring.
Whenever possible, Internal Audit will notify appropriate members of management prior to beginning an investigation. Advance notice may not be possible in rare situations when even a small delay could allow additional funds to be lost or records to be destroyed. In these situations, Internal Audit will notify management as soon as possible after the investigation begins.
The process of conducting and reporting the results of a misuse audit will be similar to the process followed for a routine audit. However, if the investigation reveals a potential violation of any federal, state, or local law, Internal Audit will refer the matter to Public Safety and/or the University General Counsel for further review and action. Internal Audit will assist these entities with their reviews, as needed. The Director of Internal Audit will use professional judgment in identifying situations that warrant disclosure to the Office of the State Auditor.
While all reports of damage, theft or misuse will be given careful consideration and treated seriously, it is important to remember that allegations are unsubstantiated unless and until corroborating evidence is obtained. The initial review and any subsequent investigation will be conducted in a confidential manner and with respect for the rights of the individuals involved.
Public Safety and the Internal Audit will conduct all investigations using applicable professional standards.