March 29, 2010

QUESTIONS FOR ... Michael Bordoni

Audit chief discusses fraud prevention

Michael Bordoni

Michael Bordoni joined Emory in 2008 to lead its Office of Internal Audit, where a major priority for him and his team is to help prevent fraud across the institution. Bordoni discusses Emory’s fraud prevention and awareness efforts and its importance to Emory, especially during the economic downturn.

Emory Report: What is the scope of oversight for your office?

Michael Bordoni: The Office of Internal Audit was created to provide internal control monitoring oversight. Our goal is to support the Board of Trustees, management, staff and faculty in safeguarding University assets through independent audits, assessments and investigations.

Emory spends approximately $3 billion each year and must guard against a variety of potentially improper and possibly illegal activities ranging from fraudulent vendor transactions to P-card improprieties, and many other forms of misappropriation of Emory funds. When potential issues related to financial misconduct or fraud are reported to management or through Emory’s Trust Line, they are referred to the internal audit office for investigation. We look at our office as the independent audit and investigative arm of Emory, similar to that of most large companies.

ER: What steps is Emory taking to promote fraud awareness, prevention and detection?

Bordoni: One of our primary goals is to educate internal audiences at Emory. For example, we educate staff and faculty about which activities are improper, including some activities that people justify in their minds as appropriate. We also educate managers about the steps that they can take to monitor their departments, and what to watch out for. Ultimately, managers are responsible for the activities of their departments, so we want them to be fully aware of warning signs and how our office can assist them if they suspect unusual behavior.

We know that desperate people do desperate things, especially in an economic downturn.

These activities are not tolerated in the best of times — they are an affront to the overwhelming majority of the Emory community who play by the rules. But during this period of economic austerity and budget reductions, this fraud is theft from departments that are already lean. Fraudulent losses have financial impact that can negatively affect  purchasing, hiring and departmental reductions in force.

ER: In your experience, how can fraud develop in a university community?

Bordoni: Employee fraud occurs when employees, who are aware that they are trusted, have the opportunity and ability to beat the system. Some of the illegal activities we see are very purposeful and intentional. But a great deal of the behavior we see begins gradually — a justification to expense outside meals because a staff member has been working overtime, or by making purchasing decisions based on personal, rather than business needs. Unfortunately, for some people the smaller actions are falsely justified and lead to more egregious improprieties. It’s a very slippery slope.

Ultimately, fraud education and prevention is a major component of maintaining an ethical community, and that is the foundation of our work. Additionally, we want members of our community to feel comfortable in reporting suspected fraud or other inappropriate activity. The Emory community supports a culture that includes ethical behavior, stewardship and accountability for each other and to Emory as an institution.  We cannot and will not tolerate behavior that deviates from the fiduciary responsibility that we all share to Emory.

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