Step Ten: Prepare the Final Report

Evaluate the sufficiency of the evidence against the required elements of proof and make sure you are able to rebut potential defenses as you prepare the final report or draft the accusation

Important Points to Remember when Drafting a Report 

Many corruption and fraud cases involve complex facts and terminology that can be confusing to the fact finder.  Be sure to present the evidence in a logical, well-organized manner, to explain any technical terms or acronyms and to simplify and clarify the evidence to the extent possible.  If helpful, attach a concise chronology of the important points or charts and summaries, but keep these devices simple and clear, not too complex and confusing.

Other important points to remember when drafting the final report:

1. Where appropriate, organize or summarize the evidence according to the elements of proof of the suspected offenses;

2. Be sure to fully identify all of the parties – firms and individuals – involved in the relevant transactions and include the dates or time frame of the key events;

3. When relying on the statements of witnesses, make sure that the witnesses are credible, that their testimony is based to the fullest extent possible on their direct, personal knowledge of the events to which they will testify (not, for example, on what they heard from others, or what they merely assume or suspect), and attempt to corroborate their testimony by other witnesses or documents;

4. When relying on documentary evidence, make sure that documents are authenticated, that is, that there is evidence that the documents are real and genuine, not forgeries or inaccurate copies. When submitting information from electronic data, make certain that the data was collected from the most reliable source and that you can demonstrate that none of the data was altered or deleted during collection;

5. If relying on circumstantial evidence of wrongdoing, make sure that all legitimate explanations for the evidence have been excluded, and that the evidence is presented in clear, concise and compelling way. For example, if offering circumstantial evidence that a public official, accused of receiving bribes, is spending money beyond his legitimate means, be sure to prove that the official had no other legitimate source for the funds;

6. Make certain that there is sufficient evidence knowledge and intent to support fraud allegations, and sufficient evidence of corrupt intent to support corruption allegations.

Knowledge and intent can be proven by direct or circumstantial evidence:

  • Direct evidence of knowledge and intent can include admissions by the subject, the statements of witnesses that they informed the subject of the important facts, or documentary evidence, such as emails or other communications of the key facts to the subject;
  • Circumstantial evidence of knowledge and intent can include evidence of the falsification of documents to support inflated claims, knowing false statements by a subject to excuse his conduct, or a pattern of repeated misrepresentations (to rebut the claim that a particular false claim was unintentional);

7. Try to identify and rebut all potential defenses that the subject might reasonably be expected to raise, for example, that large expenditures by a subject came from legitimate sources, that someone else prepared and submitted a forged document, or that a false claim was an honest mistake and unintentional.

See more detailed information on how to effectively present evidence at the basics of evidence for investigators.

COMMON REMEDIES FOR FRAUD AND CORRUPTION

The most common remedies in a private sector corruption and fraud case are:

  • To terminate the employment of the dishonest employee
  • Void the contract and terminate the business relationship with the dishonest contractor
  • Start an administrative action, such as to debar a contractor
  • Refer the case for criminal investigation or prosecution
  • File a civil action for damages due to the fraud or for an injunction barring further fraudulent conduct
  • Review and tighten controls

Terminate the employment of the dishonest employee 

Be sure that any action taken is in accordance with the organization’s employment rules and policies, and that they are not, or appear to be, affected by discrimination (race, sex, age, or otherwise), retaliation for “whistle blowing,” or other lawful exercise of the employee’s rights.  The failure to comply with the rules, or any discriminatory intent or conduct, can subject the investigator and employer to civil liability, even if the employee is guilty of fraud.

Void the contract and terminate the business relationship with the dishonest contractor

The victim can void a contract that was entered into as a result of fraud, corruption or conflict of interest, and recover any damages, such as lost profits or over-payments, that resulted.   An organization can terminate an at-will vendor relationship at its discretion, and may terminate a contractor according to the contract terms, whether or not fraud is proven, unless the termination is done as part of a conspiracy with at least one other party to restrain trade or for some other unlawful purpose.

International aid agencies can declare “Misprocurement,”meaning that a country borrower must return aid funds tainted by fraud or corruption involving the borrower’s government officials.

File an administrative action for sanctions

Many international organizations and government agencies have administrative procedures that can be used to “debar” or otherwise sanction a contractor that makes corrupt payments or commits fraud.  Debarments can last for a stated period of time or be permanent.

Refer the case for criminal investigation or prosecution

The prosecutor has the sole discretion and authority to file criminal charges and whether and how to conduct an investigation.  A criminal conviction is punished by imprisonment, fine or forfeiture, rather than an award of money damages to the victim, as in a civil case.  The court may order restitution to the victim, but this is seldom effective.

File a civil action for damages

A person, organization or government agency that is a victim of fraud can bring a civil action for damages against the responsible parties.  The defendant in a civil case, if proven liable, must pay damages to the victim, rather than be incarcerated or pay a fine, as in a criminal case.  The court can void a contract induced by fraud (such as the payment of kickbacks or an undisclosed conflict of interest), award damages, and issue other orders – known as “injunctions” – providing other relief.   A civil action can be brought in addition to or instead of criminal charges for the same transactions.

Improve controls 

Management is usually most interested in improving controls to try to prevent recurrences of serious fraud cases Controls cannot completely prevent fraud, but can make it more difficult to commit and easier to detect. Control systems include:

  • Policies that forbid the acceptance of gifts or favors and the disclosure of financial interests.
  • Transparent procurement procedures.
  • Oversight and monitoring procedures, such as testing or inspection before payment, and the insertion of audit clauses in contracts and purchase orders.
  • Announcing and enforcing appropriate corrective actions, such as mandatory termination for fraud or referral for criminal prosecution.

DRAFTING THE FINAL REPORT  

Ultimately, an investigation is only as good as the final report.  It should be accurate, complete (but concise), understandable (eliminate or explain confusing acronyms or technical terms) and cover all of the elements of proof for the alleged offenses.      

                                            SAMPLE FORMAT FOR A FINAL REPORT   

1.      A brief introduction

Provide a brief summary of the case, emphasize any particularly important points  and any follow up action required. Try to describe the essence of the case in one or two sentences.  This will force you to focus your proof and identify the most important aspect of the case.

2.      Roster of subjects

Include the normal identifying data (full legal name and date of birth, US Social Security Number, etc.) prior criminal or civil litigation history of the parties, and other pertinent background information.

3.     Summary of the facts

List the witnesses along with a summary of their testimony and the records they will introduce, organized according to the elements of the offense.  This helps to assure relevance and that there are no gaps in the proof.   In a complicated case, the report might succinctly summarize the important facts and refer to attached memos of interviews and records for additional details.  Use chronologies, charts and graphics to simplify the case and highlight the key points.  Avoid charts that are too complicated and confuse rather than clarify.

4.     Analyze and rebut anticipated defenses

Do this if the report is protected by the attorney client or some other privilege and will not be available to the defense.  Otherwise, present this information verbally to the prosecutor or civil counsel.

5.     Request for sanction or further action

Specify the requested action.   Offer to provide any necessary assistance.