The ICAC's research and experience indicates that selling tickets is a high-risk function that can provide the temptation and opportunity for fraud because it involves interaction with the community that includes access to services and cash handling. It also carries the risks associated with allocating a limited resource – the tickets.
The improper conduct of ticket vending can constitute corrupt conduct as defined by the Independent Commission Against Corruption Act 1988.
A risk assessment of ticket vending from a public sector agency may identify some or all of the following corruption risks:
- An employee manipulating the system to provide ticket/s for their own use, their friends or family without proper payment.
- An employee accepting or soliciting money or a benefit to provide tickets to someone not so entitled.
- An employee being bullied or threatened into providing ticket/s without proper payment.
- An employee misappropriating cash provided by a ticket buyer or ticket machine.
- An employee artificially inflating the value of a ticket to misappropriate cash.
Managing corruption risks
As a minimum your agency should:
- Introduce policy and procedures for ticket vending that contain elements listed in the Policy Development Guide and Checklist (see Tips and tools below).
- Include in the policy sanctions for any breach of the policy and procedures.
- Review the policy every two years.
- Refer to ticket vending in all relevant corporate documents such as codes of conduct.
- Train all relevant employees in the policy and procedures to ensure they are aware of their responsibilities.
- Include ticket vending as a risk to be assessed in the agency's internal audit and corruption risk management processes.
The following record-keeping requirements should be included in the policy:
- Recording the date, time, cost of the ticket sale, the name of the buyer and the seller if appropriate.
- Ensuring the payment method and amount is documented.
- Documenting employee delegations and changes in delegation levels.
- Recording any conflicts of interest reported by employees and how they were managed.
- Maintaining electronic records of tickets dispensed and cash collected by machines.
Risk management strategies
Following your risk assessment of ticket vending operations consider these risk management strategies:
- Adequate training for supervisors in ticketing procedures and understanding of the relevant systems, particularly when machines are involved in ticket vending.
- Involving two people in the collection procedure for cash from ticket machines.
- Regular and random auditing of the process to identify any anomalies.
- Additional supervision for high value or high demand tickets. Notifying the supervisor of all incorrectly printed or surplus tickets.
- Checking takings against sales records, including accounting for incorrectly printed or surplus tickets.
- Performing criminal history checks on employees applying for positions involved in selling tickets.
- Periodically rotating employees responsible for selling tickets to reduce the chance of employees developing inappropriate relationships with third parties.
- Increasing awareness of how clients and employees can make an enquiry or complaint about the process, so inappropriate behaviour can be identified.
|Case study 1: Refund scam|
In June 1997, an ICAC investigation found that five public transport ticket sellers had misappropriated up to $200,000 of the agency's revenue between 1994 and 1997 by manipulating the ticket vending machines.
The investigation arose because a revenue clerk noticed a high level of refund claims on tickets from one particular location.
The scam continued for three years because neither the supervisors of the ticket sellers, or the revenue department employees, understood how the outsourced ticketing system operated or how the system's internal checks could detect fraud. In addition, no revenue control staff were at the location concerned.
The ICAC recommended that the agency improve employee understanding of the ticketing system and increase supervisory oversight. The agency also commenced a cultural change program to improve awareness around the need to report and prevent corruption.
|Case study 2: Unrecorded ticket sales|
In 2003 the ICAC provided corruption prevention advice to a public sports facility following an investigation that found that an employee had misappropriated approximately $1,500 by selling tickets to a corporate hospitality area to a client on three occasions and not recording the sales.
The fraud was uncovered when the client rang the facility requesting a similar deal, while the relevant employee was on leave. There were no files or records supporting payment. The employee was questioned about the matter, apologised and resigned.
The ICAC recommended that payment records be required to accompany authorisations to print tickets, and routine reconciliations be made between records of sale, ticket allocations and the sign in register at the venue.
Frequently asked questions
|How can my agency address the corruption risks involved in using an outsourced ticketing system?|
Your agency would need to go to tender to get a provider for this service, and ensure there is a stringent, transparent and fair process for selecting the provider. You should have policies on tendering and procurement.
As part of this tendering process you may also wish to engage a probity auditor, or obtain some probity advice which will allow consideration of corruption risks. For more information, see the Procurement module.
It is also important to ensure that your ticket sellers and supervisors are well trained in the system and know how to identify any anomalies. Your audit program should include audits of any machines or systems, including those outsourced to an external provider.
|I am involved in ticket vending and would like to buy a ticket for an event that my organisation is selling tickets for. What should I do?|
You should talk to your supervisor about this and let them know that you would like to buy a ticket. This may or may not be appropriate depending on the nature of your organisation and what tickets you wish to buy.
It is likely that you would be required to:
- NSW Treasury, www.treasury.nsw.gov.au
- The Australian Public Service Commission, www.apsc.gov.au
- The Audit Office of NSW, www.audit.nsw.gov.au
- Australian National Audit Office, www.anao.gov.au
- Crime and Corruption Commission (Queensland), www.ccc.qld.gov.au
- Corruption and Crime Commission of Western Australia, www.ccc.wa.gov.au
- NSW Public Works, www.dpws.nsw.gov.au