In 2017, during a routine internal audit of our program in the Democratic Republic of the Congo (DRC), PSI uncovered that several of our employees defrauded PSI and The Global Fund of $7.38 million by inflating the costs of transporting and storing a portion of the mosquito nets in our $173 million bed net project funded by The Global Fund.
PSI has a zero-tolerance policy for fraud. As soon as we discovered the fraud, we took immediate action:
- We promptly informed The Global Fund and other donors.
- We repaid The Global Fund out of our reserves ensuring no donor or taxpayer funds were used.
- PSI no longer employs the implicated staff.
- We ceased direct implementation in the DRC.
- We instituted a range of additional controls and improvements to our existing processes to prevent recurrence.
- We hired international audit firm Grant Thornton to recommend additional safeguards beyond the steps we already were taking, and we are implementing all the recommended measures.
We’ve worked closely with The Global Fund to determine how and why this happened so we can put additional safeguards in place to prevent a similar occurrence in the future.