These procedures set forth the State University of New York’s (University) responsibilities for investigation, notification and response to suspected fraudulent activities and provide specific instructions regarding appropriate action in case of suspected improprieties of this nature.

I. Purpose

For the purpose of these procedures, suspected fraudulent or irregular activities would be those instances where a public servant intentionally uses or abuses his/her position to obtain or withhold the property of the State, State University or a related entity.

II. Applicability of These Procedures

These procedures cover state operations, auxiliary services corporations, student activity fee funds, and local campus foundations. The Research Foundation of State University of New York has a separate policy for notification and investigation of suspected fraudulent activities.

Generally, all potential defalcations expected to exceed $1,000 are subject to the notification requirements set forth in section III of these procedures. These notification requirements are also applicable in those instances where the dollar amount is insignificant but the type of conduct warrants an investigation. A campus under “special circumstances” would make such referrals.

III. Responsibility and Notification

A.   Responsibility

Management is responsible for detecting improprieties. Each manager should be familiar with the types of improprieties that might occur in her/his area and be alert for any indication that such a defalcation, misappropriation or irregularity is or was in existence in the manager’s area. As soon as an impropriety is suspected, it should be promptly reported. Each campus should identify one management employee to whom such improprieties should be reported.

B.   Notification

When sufficient facts and circumstances exist to create a reasonable suspicion that fraud has occurred, or where an investigation has commenced, a designated campus officer should forward a written detailed report on the incident concurrently to the office of the vice chancellor/chief of staff and the office of the university auditor. The report must identify applicable rules, regulations, and procedures that were violated (see Form A – Fraud Incident Report).

During the initial stages of the inquiry into the suspected fraudulent and/or irregular activities, a determination should be made jointly by campus and system administration management, as to whether the matter warrants reporting to the office of the state comptroller, in accordance with Volume XI, Section 7.0200 of the New York State Accounting System User Procedure Manual.

IV. Initial Review and Determination

Upon review of the suspected irregularities or improprieties by the appropriate offices within system administration, a determination will be made as to the type of investigation and by whom the investigation shall be conducted. After appropriate input, the office of the university auditor, in consultation with the vice chancellor/chief of staff, shall determine whether the investigation should be conducted internally, by a standing fraud investigation committee, or externally, by an independent auditor, consultant, or an outside law enforcement agency. Generally, appropriate campus personnel will be involved in all investigations relating to campus activities. These procedures address investigations that are conducted by the internal fraud investigation committee.

The fraud investigation committee will be coordinated by the office of the university auditor. Depending on the particular situation, the composition of the team may include representation from the following offices:

• university auditor
• university counsel
• employee relations
• university police and public safety
• campus personnel (public safety, internal audit, etc.)

The specific roles of the special investigation team are as follows:

1. office of the university auditor

The university auditor will coordinate overall case screening and management and provide expertise on financial matters, including accounting and administrative controls.

2. office of the university counsel

University counsel will provide advice on legal matters and will serve as liaison between the University and external agencies such as attorney general/district attorney. This office will also provide input regarding the Public Officers Law and the Ethics in Government Act.

3. office of employee relations

The office of employee relations will provide technical expertise regarding the various responsibilities and obligations that may be applicable in each case under the pertinent collective bargaining agreements. In particular, this office will provide specific information regarding interactions with bargaining unit employees and their representatives, such as but not limited to, disciplinary interrogations.

4. office of university police and public safety

The university police will assist in the fraud investigation by utilizing its contacts with local police, other law enforcement agencies, and local merchants to gather pertinent information. The office will provide suggested criminal investigation procedures and, when necessary, obtain assistance from university police and public safety departments and external law enforcement agencies.

5. campus internal audit

Although the office of the university auditor will be responsible for auditing financial matters, in certain situations the resources of campus internal auditors may be utilized to assist in the investigation process at their respective campus.

V. Investigation

Investigations that are conducted by the internal fraud investigation committee shall proceed as follows:

A.   During the initial meeting discussions, the suspected fraud and/or irregularities should be reviewed and the specific roles of the team representatives defined. Information regarding the activities should be discussed.

B.   During the course of the investigation, periodic meetings should be scheduled to discuss the progress of the investigation.

C.   Preliminary report of the investigation should be prepared and shared with the fraud investigation team and other appropriate campus and system administration officials.

D.   Finalize the investigation report and share with appropriate campus and system administration officials.

VI. Conclusions

A.   Referral to external law enforcement agencies.

Upon completion of the investigation, a determination will be made as to whether the review is conclusive and the results thereof should be forwarded to appropriate law enforcement agencies for final disposition. The office of the university counsel will make a recommendation as to the appropriate referral entity (i.e. local district attorney, office of the attorney general, etc.) and will take the necessary steps to effect that referral.

B.   Internal actions such as disciplinary proceedings, etc.

Disciplinary procedures under the labor agreements are initiated by the chief administrative officer, or designee, at each campus. Such disciplinary actions should be initiated in consultation with the office of employee relations.

Form A - Fraud Incident Report

There are no related procedures relevant to this procedure.

Reporting Thefts/Losses, Procedures for

The following link to FindLaw's New York State Laws is provided for users' convenience; it is not the official site for the State of New York laws. 

NYS State Finance Law § 8 (Duties of the comptroller.)

In case of questions, readers are advised to refer to the New York State Legislature site for the menu of New York State Consolidated.

New York State Accounting User Procedures Manual, Volume XI, Section 7.0200.

Memorandum to presidents from the senior vice chancellor, dated November 22, 1993.

Memorandum to presidents from the senior vice chancellor, dated November 22, 1993, established protocol with regard to fraud investigations and audits that affect SUNY.

There are no appendices relevant to this procedure.