Auditors find risk of fuel fraud still exists

Cayman Islands public agencies have cut down on fuel costs and reduced the number of gas cards issued to employees since a 2010 audit report found widespread potential for abuse within the system used to provide petrol for government vehicles.

However, Auditor General Alastair Swarbrick said Tuesday that a follow up audit on the same issue, conducted by government’s Internal Audit Unit and reviewed by Mr. Swarbrick’s office, has found that a number of departments still haven’t learned their lesson.

“The overall control environment has not improved since the previous fuel card audit and the internal controls surrounding these processes still require significant improvement,” Mr. Swarbrick quoted the Internal Audit Unit as stating in its follow up report on the gas card system.

The lack of controls has left government’s distribution of fuel “at significant risk of abuse and fraud”, the auditor general said.

“[The Internal Audit Unit] states that it is ultimately the responsibility of the management in each of the individual agencies to manage fuel cards and their usage and ensure that they are only used for legitimate government business,” Mr. Swarbrick noted. “This is clearly not happening.”

The internal audit review of 378 active driver fuel cards being used by 10 Cayman Islands government agencies found that 97 of those cards – more than 25 per cent –were assigned to ex-employees. Another 68 cards, or about 17 per cent went to employees that auditors said had “no business need for a [fuel] card”.

In addition, the audit review between July 2009 and June 2010 revealed that there had been 346 fuel purchases within that period which occurred less than one hour apart from each other; some of those purchases exceeded the vehicle’s fuel tank capacity.

Audits discovered 116 fuel purchases during the period where a vehicle card was used twice in the same day.

Please see Wednesday’s editions of the Caymanian Compass for the full story….