Reporting a suspected fraud perpetrator to an authorized party in an organization has never been an easy decision. Among the onerous factors are the unsupportive systems, the possibility of intimidation or bullying, lack of evidence, closed bureaucracy, and the possibility of being sued back.
Risks are even higher if the fraud was committed by a figure of authority. This is because whistleblowers often face horrendous consequences, including harassment, retaliation, and even physical assault. As a result, the majority of people prefer not to disclose any forms of fraud that they are aware of.
Declared as a suspect
A corruption case in Indonesia involving a former village head briefly graced the headlines of the mainstream media and became viral on the timeline because the whistleblower was declared a suspect. Nurhayati, a village treasurer, became a suspect after reporting a case of alleged corruption by her superior, a former village head in the Cirebon area, West Java.
When she learned of the fraud case that was allegedly leading to corruption, Nurhayati reported it in writing to the Head of Badan Permusyawarakatan Desa (BPD) Citemu, Cirebon. Instead of being appreciated for the report, she was declared a suspect by the Cirebon police investigators.
The pretext used by investigators in determining this was that Nurhayati had sent money directly to the village head. This was not in accordance with the applicable laws and procedures.
It should be noted that Nurhayati took this action at the request of the former village head. For this action, she was suspected of being involved in an evil conspiracy to cause a loss to the nation, even though she was not the one who received or used the money.
Bad Precedents for the Whistleblowing System
The determination of the suspect status of the whistleblower in the corruption case has been in the public spotlight and has drawn criticism from various parties. Nurhayati’s determination is considered unsupportive of the state program in eradicating corrupt practices.
After receiving input from various parties, the Criminal Investigation and Investigation Agency (Bareskrim) Polri conducted a case review against Nurhayati. Based on the review, the police finally halted the investigation because there was not enough evidence and released Nurhayati as a suspect.
Even though she was free and clean, it was a bitter experience for Nurhayati. She had to face a legal process and held the status of a suspect from November 2021 to around February 2022. Whereas, the corruption case would not have been revealed without a report from Nurhayati.
This case is also a clear example that being a whistleblower is not without its risks. Corruption is a form of fraud that, in practice, involves other parties. Consequently, several related parties have and act in their own interests.
Therefore, internal control is generally insufficient. Organizations need to implement a violation reporting system or whistleblowing system and socialize the system to all stakeholders.
The whistleblowing system has so far been proven effective for detecting fraud early. It is also equally important for the organizations to ensure that the whistleblowing system implemented provides a sense of security for the whistleblowers.
Integrity Asia has been trusted as a whistleblowing service provider for clients of various business backgrounds. Through the Canary® Whistleblowing System, Integrity Asia provides a combination of multiple reporting channels centered on the application and website.
This makes reporting easier for clients, while still guaranteeing the confidentiality and anonymity of the whistleblower. Guaranteed protection and confidentiality of the whistleblower’s identity will encourage various parties to report suspected fraud and fraud practices within their agencies.