Discovering fraud and documenting evidence: UNDP boosts Iraq’s forensic auditing capacities

March 28, 2023
Photo: Forensic Audit workshop, Rule of Law Programme, UNDP Iraq

Complex crimes like money laundering, corruption offences and other financial crimes can be uncovered best when investigators use innovative techniques and all relevant institutions work together. To support the relevant Iraqi authorities, UNDP has extended its financial investigation capacity building programme to auditors, lawyers and IT experts on the Federal Board of Supreme Audit (FBoA) and the Kurdistan Region Board of Supreme Audit (KBoSA) who are seeking to upgrade their skillset in order to meet contemporary demands. 

Capacity building on financial investigations under the project ‘Strengthening the Rule of Law and Human Rights to Sustain Peace and Foster Development in Iraq’ is generously funded by the US Bureau of International Narcotics and Law Enforcement Affairs (INL). Since its inception in 2021, this programme has trained more than 700 judges, prosecutors and investigators from eleven institutions in tracking money flow and investigating complex crimes. UNDP’s broader governance work supports Iraq to strengthen effectiveness, accountability, and transparency of institutions enhancing trust of citizens and enabling investment.

Between 12 and 16 March, UNDP launched a five-day workshop on forensic auditing with a group of 25 participants, including auditors from FBoA and KBoSA. The workshop sought to strengthen audit institutions’ capacities to effectively contribute to investigate corruption, fraud and abuse of public authority. Forensic auditing is a modern skillset, and has surpassed more traditional forms of auditing. 

During the interactive workshop, discussion between  trainers and participants focused on planning and executing forensic audits, as well as contributions to criminal proceedings and expert witness court appearances. During case studies, participantspractised how to apply forensics, data analytics, and cybersecurity during investigations.

According to Hind Abbas Khalaf, Legal Consultant at the Federal Board of Supreme Audit, “Forensic auditing is part of our work at the Federal Board of Supreme Audit. Our work is focused on detecting corruption cases in all government departments. This workshop discussed how to conduct audits and detect fraud.”

“During the workshop, I learned how to investigate, audit and stabilize observations to detect any kind of financial corruption in the country," adds Ms. Hind. 

The Federal Board of Supreme Audit is an independent institution and the highest financial control body submitting reports to the Iraqi Council of Representatives (CoR) according to Article 103 of the Constitution of Iraq. The Federal Board of Supreme Audit audits public service institutions and its effectiveness is key to ensuring transparency and accountability in public services.
Photo: Hind Abbas Khalaf, Legal Consultant at the Federal Board of Supreme Audit.

Tracing financial flows and in particular uncovering where funds may be hidden or misappropriated is key to successful financial investigations. Auditors can report cases where they discover fraud to the investigative judges. For a case to succeed in court, effective evidence collection in accordance with the law is key. Iraq’s Board of Supreme Audit is working closely with UNDP to help build this skillset. Throughout 2023, the project will hold five workshops with a total of 150 participants.   

“Today, Iraq is experiencing many issues, such as instability, and we can see the amount of corruption that is occurring in the country. Forensic audits help us to uncover the facts. The government's support is required to motivate us to work better and help us to fight corruption.”

-Beriywan Hamid Mohammed, Committee Head at the Federal Board of Supreme Audit.

THE UN CONVENTION AGAINST CORRUPTION Article 9 of the Convention deals with public procurement and management of public finances and states :
2. “Each State Party shall, in accordance with the fundamental principles of its legal system, take appropriate measures to promote transparency and accountability in the management of public finances. Such measures shall encompass, inter alia: (a) Procedures for the adoption of the national budget; 13 (b) Timely reporting on revenue and expenditure; (c) A system of accounting and auditing standards and related oversight; (d) Effective and efficient systems of risk management and internal control; and (e) Where appropriate, corrective action in the case of failure to comply with the requirements established in this paragraph. “
Photo: Beriywan Hamid Mohammed, Committee Head at the Federal Board of Supreme Audit.

“In my opinion, one of the many challenges that we face is the difficulty in obtaining forensic evidence. With this training, I learned the motives for fraud, the qualities of a fraudster and how to detect patterns of fraud as well as the types of corruption that will help us to enhance forensic audits. " 

- Dr. Rasha Abdulhasan, Legal Accountant at the Federal Board of Supreme Audit.

Photo: Dr. Rasha Abdulhasan, Legal Accountant at the Federal Board of Supreme Audit., UNDP Iraq.

New technologies have increased the capacity to detect and analyze fake or fraudulent documents, including fake invoice generators online.  This has helped Iraqi institutions to detect stolen funds and return them to Iraqi citizens. 

UNDP Iraq’s Security Sector Reform Programme aims to build trust and confidence between security sector institutions and communities. This includes ensuring institutional development and capacity building for accountability and oversight.