Global Fund Audits Find Misuse, Inadequate Reporting of 3 Percent of Funds
Global Fund Audits Find Misuse, Inadequate Reporting of 3 Percent of Funds
The Global Fund to Fight AIDS, Tuberculosis and Malaria has announced that an analysis of audits and investigations conducted by its
Office of the Inspector General
found that 3 percent of funding examined between 2005 and 2012 had been misspent, fraudulently misappropriated, or inadequately accounted for.
Based on twenty-eight reports compiled since 2005 involving a total of $3.8 billion in twenty-seven countries — approximately 23 percent of the fund's disbursements to date — the analysis found that 1.1 percent of the funds were spent on ineligible expenses for activities not covered by the grant agreements, 1.1 percent were inadequately substantiated due to poor or missing documentation, 0.5 percent were fraudulently misappropriated, and 0.3 percent were not reported as required.
"We do not tolerate any misuse of funds, no matter how minor," said Cees Klumper, the Global Fund's chief risk officer, who conducted the analysis. "Although some of these funds were misspent and are just ineligible expenses, a small percentage of funds are misappropriated through fraud. We actively pursue and expose all such cases."
As part of a new strategy developed in response to media reports in 2011 about the alleged misappropriation of funds, the $22 billion Global Fund is in the process of applying an improved approach to risk management with respect to its grants. Inspector General John Parsons cautioned, however, that audits and investigations conducted by his office tend to focus on high-risk areas and grants where specific risks have been identified. "It is not possible to extrapolate to say that this reflects an accurate picture of misused funds," said Parsons. "Our audits and investigations are not a representative sampling of all Global Fund grants."
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