On May 30, 2019, EXIM’s Board of Directors approved Kenneth M. Tinsley as the Chief Risk Officer, in accordance with congressional legislation and after nearly four years without a board quorum. The Chief Risk Officer chairs the Enterprise Risk Committee.
On November 21, 2019, EXIM Bank’s Enterprise Risk Committee approved an Anti-Fraud Strategy which updated EXIM’s pre-existing Fraud Procedures to align with the 2015 Government Accountability Office (GAO) “Framework for Managing Fraud Risk in Federal Programs”.
Purpose and Objective of the Anti-Fraud Strategy
The Anti-Fraud Strategy provides a formal process for EXIM to:
- Systematically identify fraud risks EXIM faces;
- Identify vulnerabilities, both inside and outside EXIM, that may result in fraud against the EXIM;
- Create a structured process that identifies potential fraud schemes and related controls that may help prevent or detect these schemes;
- Measure the effectiveness of the design and operation of EXIM’s fraud detection and prevention controls, which are also part of EXIM’s Code of Business Conduct and Ethics; and
- Incorporate the GAO “Framework for Managing Fraud Risks in Federal Programs” (GAO-15-593SP) (the “GAO Framework”) as an integral part of EXIM’s Enterprise Risk Management process.
The Anti-Fraud Strategy addresses the risk of fraud from both internal and external actors, who, in conjunction with the operating environment, can be sources of fraud and corruption risk to EXIM. The interrelationship between these may also heighten fraud and corruption risk for EXIM.
In addition to acts of fraud involving theft of assets or the misappropriation of funds, the following are examples of the types of activities that may be regarded as fraud and fall within the scope of the Anti-Fraud Strategy. The list is merely indicative and not exhaustive:
- Manipulation or misrepresenting of financial information;
- Misuse of agency’s assets;
- Deception (e.g. misrepresentation of qualifications to obtain employment);
- Offering or accepting bribes or inducements;
- Conspiracy to breach laws or regulations;
- Fraudulent completion of official documents; and
- Time & Attendance fraud.
Elements of the Fraud Risk Strategy
Consistent with the GAO Framework, EXIM conducts regular assessments of fraud risks particular to EXIM’s operating environment. Additionally, also consistent with the GAO Framework, EXIM has processes and controls to include the following:
- Preventing, detecting and investigating fraud and corruption;
- Remedying the harm from fraud and corruption through appropriate criminal, civil, administrative or disciplinary action;
- Recovering proceeds from fraudulent activity; and
- Training officials and relevant program delivery partners in fraud and corruption awareness and providing specialized training of officials involved in fraud and corruption control activities.
Roles and Responsibilities under the Anti-Fraud Strategy
The entire EXIM staff has ongoing responsibilities related to fraud risk management that are described in detail. The Anti-Fraud Strategy also designates a dedicated Fraud Risk Oversight team that has responsibility for the implementation and on-going oversight of the Anti-Fraud Strategy and related internal controls. Apart from the Fraud Risk Oversight team, the key owners of fraud risk management are as follows:
- President (and Chair) of EXIM
- Board of Directors
- Chief Risk Officer (CRO)
- EXIM Committee: Enterprise Risk Committee (ERC)
- Fraud Risk Oversight Team (FRO)
- Working Groups
- Managers
- All EXIM Staff
July 8, 2020