ICGFM International Conference “New Developments in Government Bringing Together the Tools, Talent and Technology” 2007 ICGFM International Conference “New Developments in Government Bringing Together the Tools, Talent and Technology” Presentation by Linda P. Fealing OAS Inspector General May 21, 2007

2 One of the essential purposes of the OAS is to promote and consolidate representative democracy with due respect for the principle of nonintervention. OAS Charter states that representative democracy is an indispensable condition for the stability, peace and development of the region. One of the essential purposes of the OAS is to promote and consolidate representative democracy with due respect for the principle of nonintervention. OAS Charter states that representative democracy is an indispensable condition for the stability, peace and development of the region. Recognizing that : Corruption constitutes one of the most serious threats to democracy. Corruption constitutes one of the most serious threats to democracy. Transparency in government activities, probity, responsible public administration on the part of government are essential components of the exercise of democracy. Transparency in government activities, probity, responsible public administration on the part of government are essential components of the exercise of democracy. OAS CHARTER

3 OAS and its Commitment in Fighting Corruption Member States have committed to: Ensure proper oversight of government functions. Ensure proper oversight of government functions. Call on governments to adopt and enforce measures against bribery. Call on governments to adopt and enforce measures against bribery. Establish conflict of interest standards for public employees and effective measures against illicit enrichment. Establish conflict of interest standards for public employees and effective measures against illicit enrichment. Develop mechanisms of cooperation with judicial and banking areas to facilitate investigations. Develop mechanisms of cooperation with judicial and banking areas to facilitate investigations. Utilize other international organizations to strengthen government regulations and operational processes. Utilize other international organizations to strengthen government regulations and operational processes. Develop applicable treaties and a hemispheric approach to acts of corruption Develop applicable treaties and a hemispheric approach to acts of corruption

4 Corruption - a serious threat to democratic governance OAS Secretary General : Corruption is one of the most serious threats to democratic governance. At the OAS we believe there is a lot we can do jointly and there are many ways in which we can help each other to address this issue. Corruption is one of the most serious threats to democratic governance. At the OAS we believe there is a lot we can do jointly and there are many ways in which we can help each other to address this issue. To find a solution to the problems of citizens and foster their participation in public interest affairs, the OAS must promote programs to ensure that institutions function smoothly and are efficient and transparent. To find a solution to the problems of citizens and foster their participation in public interest affairs, the OAS must promote programs to ensure that institutions function smoothly and are efficient and transparent. President of the IDB : Corruption takes opportunities away from the majority in our region diminishes the competitiveness of our countries and paralyses their economic and social development. Corruption takes opportunities away from the majority in our region diminishes the competitiveness of our countries and paralyses their economic and social development.

5 Developments 1994: The issue of Corruption was targeted for the first time in the first Summit held in Miami. 1994: The issue of Corruption was targeted for the first time in the first Summit held in Miami. 1996: The Nations of the Americas adopted the Inter-American Convention against Corruption that has now been ratified by 33 OAS Member States to : 1996: The Nations of the Americas adopted the Inter-American Convention against Corruption that has now been ratified by 33 OAS Member States to : ◊ Promote and strengthen the mechanisms needed to prevent, detect, punish and eradicate corruption. ◊ Promote cooperation among the Member States to ensure the effectiveness of measures and actions to prevent, detect and eradicate corruption in the performance of public functions. 1997: Inter-American Program was originally adopted by the OAS General Assembly. 1997: Inter-American Program was originally adopted by the OAS General Assembly. 2001: Creation of MESICIC – a political forum in the hemispheric cooperation against corruption. 2001: Creation of MESICIC – a political forum in the hemispheric cooperation against corruption.

6 Inter-American Program for Cooperation in the fight against Corruption Originally adopted in 1997, revised in 2006 to consider changes in the last nine years, the program is a framework that outlines OAS anti-corruption activities and addresses : Strengthening the MESICIC Strengthening the MESICIC Exchange of information between Member States Exchange of information between Member States Recovery of assets Recovery of assets Technical cooperation and cooperation on extradition Technical cooperation and cooperation on extradition Cooperation with other international agencies Cooperation with other international agencies Participation of civil society Participation of civil society

7 MESICIC is a follow up mechanism for the implementation of the Inter-American Convention against Corruption and to support its development through cooperation between Member States. is a follow up mechanism for the implementation of the Inter-American Convention against Corruption and to support its development through cooperation between Member States. The MESICIC facilitates technical cooperation activities as well as exchange of information, experiences and good practices The MESICIC facilitates technical cooperation activities as well as exchange of information, experiences and good practices

8 Accountability, Transparency and Efficiency In the Declaration of Mar del Plata adopted at the Fourth Summit of the Americas, in Mar del Plata, Argentina, in November 2005 the Heads of State and Government, stated: “Accountability is a key instrument to achieve transparency and efficiency in the use of resources administered by our governments. Fighting corruption is a key aspect of strengthening democracy and economic growth”. “Accountability is a key instrument to achieve transparency and efficiency in the use of resources administered by our governments. Fighting corruption is a key aspect of strengthening democracy and economic growth”.

9 Government Financial Managers Government Financial Managers need to : comply with the mandates given by our Governments for the consolidation of democratic governance, economic growth and social development. comply with the mandates given by our Governments for the consolidation of democratic governance, economic growth and social development. take effective measures to fight corruption which is the most serious threat to democracy. take effective measures to fight corruption which is the most serious threat to democracy. be aware of new developments in the business if we are to be effective financial managers. be aware of new developments in the business if we are to be effective financial managers.

10 Role of Internal Audit in the fight against Corruption The primary responsibility for the prevention, detection and investigation of fraud rests with management as part of the responsibility for establishing sufficient and satisfactory internal controls. The primary responsibility for the prevention, detection and investigation of fraud rests with management as part of the responsibility for establishing sufficient and satisfactory internal controls. Internal Audit provides independent, objective, assurance and consulting activity through systematic evaluations and analyses, adds value, improves operations and recognizes the need to link risks and related controls to achieve objectives Internal Audit provides independent, objective, assurance and consulting activity through systematic evaluations and analyses, adds value, improves operations and recognizes the need to link risks and related controls to achieve objectives Internal Auditors are required to comply with Professional Standards in the exercise of their functions and are expected to have sufficient knowledge to identify indicators of fraud. Internal Auditors are required to comply with Professional Standards in the exercise of their functions and are expected to have sufficient knowledge to identify indicators of fraud.

11 Internal auditors are well positioned to detect fraud because: They are internal and are at the organization on day –to day basis. They are internal and are at the organization on day –to day basis. They contribute to overall corporate governance. They contribute to overall corporate governance. Internal auditors must continuously be kept current on relevant developments for effective internal auditing. Professional training ensures that internal auditors attain and maintain proficiency.

12 Professional Standards The Institute of Internal Auditors (IIA) is the acknowledged leader, recognized authority, and principal educator for the internal audit profession and sets the Professional Standards.

13 OAS and other International Organizations In 2007 OAS signed two MOUs to facilitate cooperation among countries in their efforts to fight corruption in the exercise of public functions : Inter-American Development Bank (IDB) Inter-American Development Bank (IDB) Organization for Economic Co-operation and Development (OECD) Organization for Economic Co-operation and Development (OECD) Main purpose: To promote and strengthen necessary mechanisms to prevent, detect, sanction and eradicate corruption in the Member countries by facilitating cooperation among countries in their efforts to fight corruption in the exercise of public functions. Systems of government hiring and procurement of goods and services. Systems of government hiring and procurement of goods and services. Systems for protecting public servants and private citizens who, in good faith, report acts of corruption and; Systems for protecting public servants and private citizens who, in good faith, report acts of corruption and; Acts of Corruption Acts of Corruption

14 Technological development The theme at the 2006 OAS General Assembly was: The theme at the 2006 OAS General Assembly was: “Good Governance and Development in the Knowledge-based Society” One of the major challenges recognized by the General Assembly for One of the major challenges recognized by the General Assembly for achieving full democracy: Technological development is one of the major needs of the Member Countries.

15 Link between OAS, IDB, the IIA and other International Institutions in the fight against fraud OAS joined the IDB in organizing a workshop on development of the Internal Auditing function to combat fraud and corruption OAS joined the IDB in organizing a workshop on development of the Internal Auditing function to combat fraud and corruption. The IIA is developing a new global model for implementing effective internal auditing. The IIA is developing a new global model for implementing effective internal auditing.

16 IDB-OAS workshop Summary of Conclusions IDB - Martin Guozden IDB - Martin Guozden IIA - Colleen Waring IIA - Colleen Waring

17 THANK YOU Linda P. Fealing