Fraud– An intentional deception that violates a law or the public trust for personal benefit or the benefit of others.
Waste – Behavior involving the extravagant, careless, or needless use of government funds, property, and/or personnel.
Abuse – Behavior involving the use of government funds or property that a prudent person would not consider reasonable and necessary business practice given the facts and circumstances.
Since October 1983, the Comptroller of the Treasury has provided
a toll-free hotline for reporting fraud, waste and abuse of
government funds and property. Periodicals throughout Tennessee
publish information to alert citizens to the hotline and to
encourage them to report wasteful, inefficient or fraudulent
activities. In addition, all state agencies, as well as those
agencies receiving community grant funds, are required to call
attention to the hotline by displaying in a prominent place
signs with the following language:
If you observe an agency director or employee engaging in
any activity which you consider to be illegal, improper or wasteful,
please call the State Comptroller's Toll-Free Hotline:
Please click on the phrase below to be directed to the
online reporting form.
Calls and online submissions to the hotline should concern allegations
of fraud, waste, and abuse. Substantive notifications, may
concern a wide range of entities, including municipalities,
counties and state agencies and departments. In the event of
nonsubstantive notifications, such as requests for assistance
or information, the reporting party may be referred to the
appropriate agency or department for assistance.
In 2007, The General Assembly passed the
Government Instances of Fraud Reporting Act” (Section 8-4-501,
Tennessee Code Annotated). This act provides that public officials
“with knowledge based upon available information that unlawful
conduct has occurred shall report the information in a reasonable
amount of time to the office of the Comptroller of the Treasury”
The act defines “public entity,” “public official,” “reasonable
amount of time,” and “unlawful conduct.”
Provisions The act provides that “The comptroller
shall have the power to prescribe the method of making such reports.”
Therefore, we have prepared a Fraud Reporting Form to be used
by public officials.
The Governor signed the act on May 22, 2007,
and it is now in effect as law.
Paragraph 7 of the Contract to
Audit accounts includes the following provisions for
Any reasonable suspicion of fraud, (regardless of materiality) or other unlawful acts including, but not limited to theft, forgery, credit/debit
card fraud, or any other act of unlawful taking, waste, or abuse of, or official misconduct, as defined in Tennessee Code Annotated, § 39-16-
402, involving public money, property, or services shall, upon discovery, be promptly reported in writing by the auditor to the Comptroller of
the Treasury, State of Tennessee, who shall under all circumstances have the authority, at the discretion of the Comptroller, to directly
investigate such matters. Notwithstanding anything herein to the contrary, the Comptroller of the Treasury, State of Tennessee,
acknowledges that the auditor's responsibility hereunder is to design its audit to obtain reasonable, but not absolute, assurance of detecting
fraud that would have a material effect on the financial statements, as well as other illegal acts or violations of provisions of contracts or grant
agreements having a direct and material effect on financial statement amounts. If the circumstances disclosed by the audit call for a more
detailed investigation by the auditor than necessary under ordinary circumstances, the auditor shall inform the organization's management
and those in charge of governance in writing of the need for such additional investigation and the additional compensation required therefor.
Upon approval by the Comptroller of the treasury, an amendment to this contract may be made by the organization's management and those
charged with governance and the auditor for such additional investigation.
In order to comply with this requirement,
the auditor should describe the suspected fraud in as
much detail as possible. If known, information about
the names and positions of suspected individual(s) involved,
dates, amounts, records involved, how the fraud was discovered,
etc. should be included. All instances of fraud, regardless
of materiality, should be reported.
Please send this information to
our office via one of following:
Attention: Contract Review
1500 James K. Polk State Office Building
505 Deaderick Street
Nashville, TN 37243-1402
Phone: (615) 401-7841
Fax: (615) 741-6216