Strømme Foundation (SF) works in 12 countries, and is implementing approximately 150 projects.
The two main areas of intervention are education and microfinance with an annual budget of around 130 mill. NOK plus 105 mill. NOK in the microfinance portfolio. The head office of the organisation is located in Kristiansand. SF is implementing its projects through local organisations in each country.
SF has a zero tolerance for corruption and believes that corruption is both a cause of poverty, and a barrier to overcoming it. It is one of the most serious obstacles to reducing poverty.
As all of our projects are in countries highly affected by corruption, we are constantly fighting corruption in our work; both on partner level, regional level and head office level. In 2010, SF implemented a renewed anti fraud and corruption policy. There has been an increased focus on risk assessment and risk management, as well as control mechanisms. Still, we estimate the financial loss due to corruption to be approximately 280.000 NOK in 2010.
Below is a short description of the cases that were confirmed and closed in 2010:
Sri Lanka:
One of our microfinance partners in Sri Lanka could not document their expenses and we have reason to believe that money has been stolen. This case was discovered by SF during routine control, and later investigated. SF’s regional office is working on recovering the money. The staff involved have been removed from their positions and SF is closing the relationship with this partner.
The second case in Sri Lanka was related to a partner involved in both education and microfinance, where SF suspected fraud from the management side. This was never proven, but SF chose to phase out the cooperation with this partner.
Sudan:
In Sudan we experienced that an accountant in one of our integrated education/microfinance projects was misusing funds, and the case was thoroughly investigated by auditors. The amount has been refunded by the partner, but SF has terminated all cooperation with this partner.
The second case of fraud in Sudan was an education project where an accountant misused SF funds and left with all the accounting books and records. The project is in a very remote area, which makes the investigation difficult. The lost amount is unclear since all books are missing. SF has terminated working with this partner.
With a substantial number of projects, it would be unrealistic to completely avoid cases of corruption in our projects. While we don’t like to discover corruption, it is at least reassuring that the systems we have in place enable us to detect cases and handle them well.