FAC Explorer

Finding 626394 (2022-005)

Significant Deficiency Repeat Finding
Requirement
P
Questioned Costs
-
Year
2022
Accepted
2023-06-28
Audit: 46560
Organization: Population Services International (DC)
Auditor: Bdo

AI Summary

  • Core Issue: Multiple fraud incidents were identified across various countries, impacting federally funded programs.
  • Impacted Requirements: Compliance with audit criteria requiring reporting of known or suspected fraud, as outlined in ?200.516(a).
  • Recommended Follow-Up: Continue ongoing investigations and ensure all findings are reported to the appropriate U.S. agencies, while monitoring for any further financial losses.

Finding Text

2022-005 Allegations of Fraud See Schedule of Findings and Questioned Costs for chart/table. Criteria: ?200.516(a) Audit findings requires known or suspected fraud be reported by the auditor. Condition: During 2022, PSI identified multiple fraud incidents through its internal reporting mechanisms that impacted its federally funded programs. These fraud incidents have been reported to the appropriate U.S. Office of the Inspector General by PSI. ?In the Republic of Malawi, a demand creation supervisor knowingly assigned walk-in clients to an external party through a contract that was wrongfully issued with the intention to defraud PSI Malawi. The total financial loss to award 72061220CA00003 was $112. ?In the Democratic Republic of the Congo, allegations of possible manipulation of procurement of COVID-19 personal protective equipment led to an expanded investigation of procurements and unsupported transactions related to task order #14 of the COVID-19 funding for award 7200AA18C00014. This investigation resulted in the disallowance of $216,227. ?In the Republic of Tanzania, a clinical advisor breached mentorship protocols and did not visit health facilities as required in the approved activities plan. The costs incurred related to the unapproved mentorship activities totaled $12,749 for award 7200AA18C00014. ?In the Republic of Zimbabwe, enhanced peer mobilizers overclaimed the number of clients who were successfully referred to the program. The attributable financial loss to award 72061318CA00009 is $1,314. The falsification of information from the enhanced peer mobilizers did not affect the accuracy of actual clients who received services because the actual client service delivery records are maintained by an independent service provider based on actual clients served. ?In the Republic of Sierra Leone, a third-party vendor used by PSI Sierra Leone to obtain motorcycle registration and licensing fees colluded with PSI Sierra Leone staff to inflate the charges levied by the relevant authority and administration fee payable to the vendor. The total financial loss to award 7200AA18C00014 was $1,335. ?In the Republic of Zimbabwe, two employees misappropriated project cash advances meant for training and beneficiary payments. One of those same employees improperly accounted for mileage and fuel use. Both of these matters resulted in a total financial loss to award 72061318CA00009 of $1,758. ?In Washington D.C. at PSI?s headquarters, a technical advisor fraudulently reported lodging costs on an expense report. The expense was not reimbursed to the technical advisor and no amounts were charged to award AID-OAA-I-17-00008. Therefore, there was no financial loss to the award. ?In the Republic of Sierra Leone, an administrative officer received a 5% kickback on certain procurement transactions. There were 46 total transactions totaling $116,005 for which kickbacks were received. The financial loss to award 7200AA18C00014 was determined by calculating 5% of the total transactions, totaling $5,800. ?In the Republic of Zimbabwe, an investigation revealed that certain program ambassadors working on award 72061318CA00009 claimed unusually high mobilization fees due to data falsification. The data falsification did not impact the reportable outputs because different controls were in place for the final output data. There was also no loss to the award because payments to the program ambassadors were withheld until the investigation was completed. ?In the Kingdom of Lesotho, certain employees falsified travel expense report records resulting in a financial loss to award NU2GGH002005 totaling $185. ?In the Republic Cameroon, payment records for reimbursement of certain expatriate education benefits were falsified. This falsification of records resulted in the overpayment of tuition of $38,607 related to award 7200AA18C00014. ?In the Republic of Niger, certain employees falsified expense reports related to per diem amounts for activities that did not occur. This resulted in a financial loss to award 7200AA18C00014 totaling $2,942. ?In the Republic of Zimbabwe, data falsification related to circumcisions in the Makoni district resulted in a financial loss to award 72061318CA00009 totaling $2,644. ?In the Kingdom of Lesotho, certain fixed assets including computers, chairs, tables, and gas cylinders were stolen. Upon filing of a police report, certain assets were recovered. The value of items that were unable to be recorded totaled $3,326 for award NU2GGH002005. ?In the Republic of Zimbabwe, an employee falsified documentation related to fuel usage totaling $30 for award 72061318CA00009. ?In the Kingdom of Cambodia, an employee falsified expense records for meeting refreshments which resulted in a loss to award 72044218CA00006 of $665. PSI has ongoing investigations involving U.S. Federal funding pending in multiple countries for which the facts and circumstances and full effect of the fraud investigations have not been determined. Where investigations are still pending and conclusions of the matters identified through whistleblower or other communications have not been reached, PSI has reported such matters to the appropriate U.S. agency. Questioned Costs: There are no questioned costs as the questioned amounts have been, or are in the process of, being reimbursed to the respective Federal agency. Context: These conditions were identified through PSI?s internal review and audit processes and were reported to us during our internal control assessment for the year ended December 31, 2022. Cause: Individuals intentionally circumvented PSI?s established internal controls. Effect: These conditions could result in unallowable expenses being charged to U.S. Government awards if controls in place had not identified the conditions. Repeat Finding: The specific items identified above were not reported in the prior year; however, findings related to fraud were included for the prior three years as findings 2021-005 in the December 31, 2021 schedule of findings and questioned costs, 2020-005 in the December 31, 2020 schedule of findings and questioned costs, and 2019-004 in the December 31, 2019 schedule of findings and questioned costs. Recommendation: Because of the international environment in which PSI operates, the potential for fraud is heightened. Given this, we recommend management continue to utilize its global internal audit team and fraud reporting hotline, as well as other policies and procedures around fraud identification to mitigate the fraud risk. Views of Responsible Officials: PSI management agrees with the finding and recommendations set forth within and will proactively report and investigate allegations of fraud and to raise awareness of the actions to be taken when there is a suspicion of fraud. Refer to management?s correction action plan for additional information.

Categories

Procurement, Suspension & Debarment Allowable Costs / Cost Principles Cash Management Reporting Equipment & Real Property Management Internal Control / Segregation of Duties

Other Findings in this Audit

  • 39494 2022-005
    Significant Deficiency Repeat
  • 39495 2022-005
    Significant Deficiency Repeat
  • 39496 2022-005
    Significant Deficiency Repeat
  • 39497 2022-001
    Significant Deficiency Repeat
  • 39498 2022-005
    Significant Deficiency Repeat
  • 49946 2022-002
    Significant Deficiency Repeat
  • 49947 2022-005
    Significant Deficiency Repeat
  • 49948 2022-002
    Significant Deficiency Repeat
  • 49949 2022-005
    Significant Deficiency Repeat
  • 49950 2022-002
    Significant Deficiency Repeat
  • 49951 2022-004
    Significant Deficiency
  • 49952 2022-005
    Significant Deficiency Repeat
  • 49953 2022-006
    Significant Deficiency Repeat
  • 49954 2022-002
    Significant Deficiency Repeat
  • 49955 2022-001
    Significant Deficiency Repeat
  • 49956 2022-003
    Significant Deficiency
  • 49957 2022-001
    Significant Deficiency Repeat
  • 49958 2022-004
    Significant Deficiency
  • 615936 2022-005
    Significant Deficiency Repeat
  • 615937 2022-005
    Significant Deficiency Repeat
  • 615938 2022-005
    Significant Deficiency Repeat
  • 615939 2022-001
    Significant Deficiency Repeat
  • 615940 2022-005
    Significant Deficiency Repeat
  • 626388 2022-002
    Significant Deficiency Repeat
  • 626389 2022-005
    Significant Deficiency Repeat
  • 626390 2022-002
    Significant Deficiency Repeat
  • 626391 2022-005
    Significant Deficiency Repeat
  • 626392 2022-002
    Significant Deficiency Repeat
  • 626393 2022-004
    Significant Deficiency
  • 626395 2022-006
    Significant Deficiency Repeat
  • 626396 2022-002
    Significant Deficiency Repeat
  • 626397 2022-001
    Significant Deficiency Repeat
  • 626398 2022-003
    Significant Deficiency
  • 626399 2022-001
    Significant Deficiency Repeat
  • 626400 2022-004
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
98.U00 Advancing Progress in Malaria Service Delivery $41.67M
98.001 Going the Last Mile for Hiv Control $20.40M
98.001 Momentum Targeted Mnch/fp/rh Technical Assistance to Private Providers $19.95M
98.001 Angola Health for All $11.66M
98.001 Improving Market Partnerships and Access to Commodities Together (impact) $10.87M
98.001 Donated Commodities $8.26M
98.U00 Donated Commodities $6.73M
93.067 Provision of Voluntary Medical Male Circumcision (vmmc) for Hiv Prevention in the Republic of South Africa Under the President's Emergency Plan for Aids Relief (pepfar) $6.70M
98.U00 Global Health Supply Chain (gshc) - Procurement and Supply Management (psm) $6.09M
98.001 Ethiopia Transform: Water, Sanitation and Hygiene $5.73M
98.001 Stop Djekoidjo $4.34M
98.001 Hiv Services for Key and Priority Populations $4.33M
98.001 Covid-19 - Angola Health for All $3.94M
98.001 Expanding Malawi Hiv-Aids Prevention with Local Organizations Working for An Effective Epidemic Response (empower) $3.82M
98.U00 Vector Control Indefinite Delivery Indefinite Quantity Contract (vc Idiq", Project") $3.53M
98.001 Cambodia Promoting Healthy Behaviors Activity $3.50M
98.001 Samagra: A Total Market for Comprehensive Consumer-Empowered Primary Health $3.16M
93.067 Scaling Up Targeted Hiv Testing Services and Linkage to Treatment $2.94M
98.001 Covid -19 - Going the Last Mile for Hiv Control $2.83M
12.350 Cdi Dhapp Faci Partnership for Sustainable Hiv Epidemic Control $2.66M
93.067 Improving Hiv/sti/tb Prevention, Treatment and Care Services for Mobile Populations $2.36M
93.067 Strategic Scale Up of Community Based Hiv Testing and Counseling $2.33M
12.350 Burundi National Defense Force (bndf) Partnership for Sustainable Hiv Epidemic Control $2.13M
98.001 Tubiteho $1.93M
98.001 Tb/hiv Agency, Information and Services $1.65M
98.001 Covid -19 - Meeting Targets and Maintaining Epidemic Control (epic) $1.56M
98.001 Enhancing Quality of Healthcare Activity $1.31M
98.001 Improved Family Planning Initiative $1.13M
98.001 Evaluation Innovative Technologies and Approaches to Addressing Cervical Cancer in the Republic of Mozambique $1.04M
98.001 Hiv Prevention for High Risk Individuals $1.04M
98.001 Madagascar's Accessible Continuum of Care and Essential Services Sustained (access) $902,728
98.001 Countywide Sanitation Activity (cwsa) $725,677
98.001 Myanmar Essential Health Services Program $706,979
98.001 Expanding Contraception $664,246
12.350 Lesotho-Military Specific Hiv/aids Prevention, Care, and Treatment Program for Pepfar Funded Countries $606,476
98.001 Tanzania Malaria Case Management Activity $578,095
98.001 Mozambique Small Town Sanitation Project $525,474
98.001 The Kampala Slum Maternal Newborn Project: Innovating for Better Systems Outcomes $441,658
12.350 Central America Regional Partnership for Sustainable Hiv Epidemic Control in the Guatemalan, Honduran and Salvadoran Militaries $423,396
98.U00 Usaid West Africa Municipal Wash (muniwash) $405,921
98.001 Research for Scalable Solutions (r4s) $381,148
93.067 Recent Infection Surveillance Consortium $341,069
98.001 Covid -19 - Path and the Digital Health Initiative - Accelerating the Cycle for Investment $332,189
98.U00 Usaid Western Kenya Sanitation Project (wksp) $310,541
98.001 Covid - 19 - Expanding Malawi Hiv-Aids Prevention with Local Organizations Working for An Effective Epidemic Response (empower) $290,891
98.001 Covid-19 - Samagra: A Total Market for Comprehensive Consumer-Empowered Primary Health $265,928
93.067 Donated Commodities $232,586
98.001 Covid - 19 - Hiv Services for Key and Priority Populations $228,607
98.U00 Covid -19 - Advancing Progress in Malaria Service Delivery $219,882
98.001 Unaids in Support of the Unified Budget and Workplace $198,671
98.001 Digital Health Initiative Accelerating the Cycle of Investment to Impact in Global Digital Health $197,669
98.001 Next Generation Products for Prevention of Hiv Infection in Women (nix Hiv) $148,796
98.001 Health and Hygiene Project $117,889
12.350 Advancing Multi-Country Hiv Support in Collaboration with Dhapp and Partner Militaries for Sustainable Hiv Epidemic Control (multi-Country) $114,693
98.001 Covid - 19 - American Rescue Plan Act (arpa) Covid-19 Support $71,062
93.318 Covid-19 Vaccination Program Support in Eswatini $70,386
98.001 Covid -19 - Ethiopia Transform: Water, Sanitation and Hygiene $52,331
98.001 Usaid Hiv Prevention, Testing and Treatment Services for Key Populations $48,592
98.001 Growth Through Nutrition $41,861
98.001 Bangladesh Marketing Innovations for Sustainable Health Development $41,091
93.067 Covid-19 - Improving Hiv/sti/tb Prevention, Treatment and Care Services for Mobile Populations $40,372
93.067 Covid - 19 - Strategic Scale Up of Community Based Hiv Testing and Counseling $32,282
98.001 Covid -19 - Research for Scalable Solutions (r4s) $7,738
98.001 High Impact Maternal, Newborn and Child Health (hi-Mnch) Activity $3,767
98.001 Family Planning Integrated Project $-5
12.350 Hiv/aids Prevention, Care and Treatment Support to the South African National Defense Force $-42
98.001 Meeting Targets and Maintaining Epidemic Control (epic) $-107
19.703 Costa Rica - Building Capacity to Prevent and Address Domestic Violence $-161
93.067 Covid -19 - Scaling Up Targeted Hiv Testing Services and Linkage to Treatment $-279
93.067 Programmatic Implementation and Technical Assistance (ta) for Hiv/aids $-702
98.001 Sustaining Health Outcomes Through the Private Sector Project Plus (shops Plus) $-874
93.067 Accelerating Epidemic Control in 7 Districts of Mubende Region in the Republic of Uganda Under the President's Emergency Plan for Aids Relief (pepfar) $-1,981
98.001 Zimbabwe Strengthening Private Sector Services Project $-962,286