The Scandal Of The Otago District Health Board Essay

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Introduction Fraud is defined as dishonest activity causing actual or potential financial loss to any person or entity, including theft of money of other property, by employees or persons external to the entity, and where deception is used at the time, immediately before or immediately following the activity1. Fraud is an emerging problem both nationally and globally and is an increasing problem all around the world2. The most significant fraud of state services in the short history of NZ was the scandal of the Otago District Health Board (ODHB) which was uncovered in 20083. The Chief Information Technology Officer (CIO) at the time was the 47-year-old Michael Swann, whom was instrumental to this case of fraud. Swann was able to perpetrate a multimillion-dollar fraud with the help of his friend Kerry Harford by generating illegitimate and fallacious computer, software and insurance invoices. ODBH was defrauded of almost $17 million NZD over 6 years3. A repercussion of this scandal as had detrimental implications on the stakeholders of ODHB and we will look into that in this report. We will also outline the auditor’s role and responsibilities in this report, and if they are liable for any of the damages suffered by plaintiffs. We will conclude with briefly covering the outcome of the fraud case and the current situations are for those involved. The Organisation The ODHB was a government-funded organisation that served approximately 70% of people in the New Zealand city of

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