Celebrity-backed Global Health Fund Plagued by Fraud, Mismanagement
Irish rock star Bono in Rwanda
UPDATE: SL-USA
November 2 - Mismanagement, fraud, and misspending plague the handling of grants made by a global health fund which was set up as an alternative to the cumbersome UN bureaucracy, to fight AIDS, Tuberculosis, and Malaria in several African and Asian countries, including Sri Lanka.
The Global Fund to Fight AIDS, Tuberculosis and Malaria, launched in 2002 as $21.7 billion development fund backed by celebrities such as Irish rock star Bono, has posted the results of its own internal audits and fraud probes on its website. A high-level Review Panel on Fiduciary Controls and Oversight Mechanism established in March after the Global Fund’s Office of the Inspector General reported misappropriation of $53 million in grant funds in some countries.
Auditors reviewed grants in 40 countries including Nigeria, Mauritania, Dominican Republic, Madagascar, Sri Lanka, South Sudan, Swaziland and Togo, and examined almost a half-billion dollars in fund programs run by Washington, D.C.-based Population Services International.
The probes turned up $20 million of mismanagement, alleged fraud and misspending. The panel has submitted its recommendations to the Global Fund’s Board and finds that the organization needs to focus much more on its core business of managing grants to save and protect lives. It recommends improving financial and Board oversight, simplifying grant application processes, and putting in place a robust risk management framework.
“This independent review is a major part of a broader set of measures that continue to be implemented to strengthen the Global Fund’s financial safeguards,” the report said.
In Sri Lanka, where the Global Fund’s 14 grant recipients have included the Ministry of Health, Lanka Jatika Sarvodaya Shramadana Sangamaya, and Tropical and Environmental Disease and Health Associates
financial management was cited as the most prevalent category of weakness. A significant number of procurement problems, in the tender and bidding processes, were also evident, the report said. Within the financial-management area, the subcategorieswith the most vulnerabilities were accounting systems, budget-monitoring, flow-of funds, audits, program-management, the management of records and documents, staffing and salaries, and treasury-/bank-management.
Severe problems were detected in Nigeria where the probe found $22 million in unauthorized foreign currency exchanges by a not-for-profit center in Abuja, that diverted hundreds of thousands of dollars to non-fund accounts. In India, at least $872,000 had been misappropriated, some transferred to a shell corporation and used to rent and renovate an official’s home.
A third probe was in Mauritania, where $6.73 million in potential fraud and other losses were found but the country has already paid back $4.2 million.
Link - read the Global Fund's findings: http://www.theglobalfund.org/en/highlevelpanel/
November 2 - Mismanagement, fraud, and misspending plague the handling of grants made by a global health fund which was set up as an alternative to the cumbersome UN bureaucracy, to fight AIDS, Tuberculosis, and Malaria in several African and Asian countries, including Sri Lanka.
The Global Fund to Fight AIDS, Tuberculosis and Malaria, launched in 2002 as $21.7 billion development fund backed by celebrities such as Irish rock star Bono, has posted the results of its own internal audits and fraud probes on its website. A high-level Review Panel on Fiduciary Controls and Oversight Mechanism established in March after the Global Fund’s Office of the Inspector General reported misappropriation of $53 million in grant funds in some countries.
Auditors reviewed grants in 40 countries including Nigeria, Mauritania, Dominican Republic, Madagascar, Sri Lanka, South Sudan, Swaziland and Togo, and examined almost a half-billion dollars in fund programs run by Washington, D.C.-based Population Services International.
The probes turned up $20 million of mismanagement, alleged fraud and misspending. The panel has submitted its recommendations to the Global Fund’s Board and finds that the organization needs to focus much more on its core business of managing grants to save and protect lives. It recommends improving financial and Board oversight, simplifying grant application processes, and putting in place a robust risk management framework.
“This independent review is a major part of a broader set of measures that continue to be implemented to strengthen the Global Fund’s financial safeguards,” the report said.
In Sri Lanka, where the Global Fund’s 14 grant recipients have included the Ministry of Health, Lanka Jatika Sarvodaya Shramadana Sangamaya, and Tropical and Environmental Disease and Health Associates
financial management was cited as the most prevalent category of weakness. A significant number of procurement problems, in the tender and bidding processes, were also evident, the report said. Within the financial-management area, the subcategorieswith the most vulnerabilities were accounting systems, budget-monitoring, flow-of funds, audits, program-management, the management of records and documents, staffing and salaries, and treasury-/bank-management.
Severe problems were detected in Nigeria where the probe found $22 million in unauthorized foreign currency exchanges by a not-for-profit center in Abuja, that diverted hundreds of thousands of dollars to non-fund accounts. In India, at least $872,000 had been misappropriated, some transferred to a shell corporation and used to rent and renovate an official’s home.
A third probe was in Mauritania, where $6.73 million in potential fraud and other losses were found but the country has already paid back $4.2 million.
Link - read the Global Fund's findings: http://www.theglobalfund.org/en/highlevelpanel/