Corruption and fraud harms everyone in sport and recreation. People have the right to enjoy sport and recreation in way that is safe and fair. Corruption and fraud can take away that right from you.  

It can also divert money away from where it needs to go. For example, when someone takes fundraising proceeds, it impacts everyone. Participants miss out and funds that are intended for those who really need it end up being used to cover that loss. 

People can also lose trust in the club or organisation and the people who run it. As a result, clubs and organisations may lose:  

• members and volunteers if people feel they haven’t been treated fairly  

• people who are thinking of joining an organisation  

• funding and sponsorship opportunities.  

Fraud is where someone deliberately lies or uses deception to obtain a benefit or advantage. For example, a team manager invoices a club for a hotel room and meals they didn’t stay at during a weekend training camp. 

Corruption is someone using their position to improperly obtain a benefit or advantage, either for themselves or someone else. For example, a board member making a decision because it benefits them or their friends, rather than benefiting the sport. Or giving a family member a job or opportunity because of that connection and not because they are qualified to do the job. 

In both cases, the motivation is often financial, but it doesn’t have to be. It is deliberate wrongdoing, not negligence or a mistake.  

Corruption and fraud can include bribery, conflicts of interest, misuse of funds, or stealing. It is also closely linked to match-fixing, using inside information for sports betting, and doping in sport. 

Learn about competition manipulation

It’s well documented that corruption and fraud happen on a global scale and we are not immune to it in Aotearoa New Zealand. And, like business organisations or the public sector, sport and recreation clubs and organisations can be affected by corruption and fraud.  

Having a strong culture of integrity, good policies and processes in place, and educating staff and volunteers to recognise and report the signs, can help prevent corruption and fraud happening. It also keeps you safe. 

Many clubs and organisations have limited resources and staff. They rely heavily on volunteers to manage administrative duties including financial management, recruitment and conflicts of interest. While most people do an excellent job and act with integrity, they may not have the time or experience to make sure internal controls and processes are implemented or sufficiently monitored.  

Or the club or organisation doesn’t have processes in place to support the people who are running things. Organisations may also be reluctant to call out volunteers who are giving their time for free.  

It’s important there is a strong culture of integrity, good governance, and financial checks and balances to make sure the opportunities to commit fraud or engage in corruption are reduced. 

Someone is more likely to be corrupt or commit fraud if there is:  

• opportunity: circumstances that allow fraud or corruption to occur, for example, inadequate financial checks and balances at the club or organisation  

• pressure: the incentive to commit fraud, for example someone has personal money problems 

• rationalisation: a person justifies their behaviour to commit fraud or corruption, for example, the mindset that “others are doing it so why can’t I?”. 

Fraud and corruption can take many forms and isn’t always as straightforward as someone stealing money.  

Examples 

• An official gets an approved quote for some uniforms, but they get them cheaper and keep the difference rather than return it. 

• An athlete offers an official money to ignore a positive drug test.  

• A sports club gives free tickets and corporate box entry to a local councillor in exchange for supporting the club’s application for a funding grant.  

There are common warning signs someone could be committing fraud. This behaviour does not always mean there is fraud, but taken together can represent a red flag that might require a closer look.  

• Living beyond your means: Spending more than a person earns, buying lavish goods and services. 

• Being in financial difficulty: Personal financial problems can motivate some people to commit fraud. 

• Unusually close relationships with a supplier: This can indicate a conflict of interest or some form of collusion. 

• Being very controlling or not wanting to share duties: A lack of transparency, being vague and reluctant to delegate tasks can be red flags for fraudulent activity. 

• Irritability or defensiveness: changes in someone’s behaviour such as increased aggression or defensiveness when challenged can be a sign of underlying fraudulent behaviour. 

A conflict of interest is where your duties or responsibilities at your club overlap or conflict with your job, business or other interests you have outside the club. Conflicts of interest can be real or perceived – both matter.  

For example, you are the chairperson at your local croquet club. Your family owns a lawnmowing business and applies for the contract to maintain the croquet club’s grounds. This is a conflict of interest for you because you could use your position to influence who is awarded the contract, even if you are completely above board.  

The important thing is to declare all conflicts of interest, whether it’s a real conflict or looks like it could be. This can allow an organisation to respond to the conflict by removing a person from a decision-making role if they have a conflict. 

It could be corrupt if you: 

• hide or intentionally fail to disclose a conflict of interest 

• lie about a conflict of interest. 

Managing conflicts of interest – oag.parliament.nz 

Giving koha, gifts, attending events and providing hospitality is an important part of our culture. It’s a way to celebrate or to show appreciation. For example, a team giving their coach a thank you gift at the end of the season. 

But giving or receiving gifts or hospitality should never be used to try and influence decisions or benefit anyone. Never accept gifts if you are unsure about the motive behind them, or you are expected to do something in return for the gift. 

You should also agree as an organisation what gifts are appropriate in terms of value and nature and keep a record of what you are offered and what you accept. 

If you see or suspect someone is committing fraud or acting suspiciously, tell your club or organisation’s welfare or safeguarding officer. 

You can also make a make a complaint directly to us at the Commission. 

Make an integrity complaint  

You are protected if you raise a concern: Retaliation and victimisation 

Effectively combating corruption and fraud requires accountability, integrity and resources. You can help prevent corruption and fraud by: 

• having strong leadership that’s committed to tackling corruption and fraud 

• identifying the risk areas at your club or organisation 

• putting policies and processes in place to reduce the risks  

• implementing financial controls 

• managing conflicts of interest 

• implementing a gift policy and register 

• communicating and educating staff, volunteers and participants to identify and prevent corruption and fraud 

• doing background checks on staff and volunteers who manage finances 

• making reporting easy. 

Identify the areas in your club or organisation where corruption or fraud could potentially happen. For example: 

• do you receive proceeds from fundraising activities, grants or sponsorship money, and good records of how that money is spent 

• do you have adequate financial controls and systems 

• are your staff and volunteers sufficiently experienced or trained to know how to respond to fraud and corruption risks. 

Have policies and procedures that address corruption and fraud. Relevant policies can include:  

• Financial controls 

• Code of conduct 

• Recruitment policy 

• Conflict of interest policy 

• Koha/gift policy and register 

Finance policies | Sport New Zealand - Ihi Aotearoa 

Implement financial controls to limit opportunities for fraud. Adopt: 

• timely and accurate financial reporting systems 

• procedures to safeguard assets and finances, for example: 

• external auditing and independent reconciliation of bank statements 

• transactions being authorised by two or more people 

• thoroughly checking invoices against services and suppliers 

• regular monthly financial reporting. 

• Manage conflicts of interest by being open and honest, and disclose any actual or perceived conflicts of interest.  

• Make sure everyone understands the risks of conflicts of interest, what situations to avoid, how to register and respond to conflicts of interest. 

• Communicate with everyone your expectations for accepting gifts. For example, when it’s appropriate to accept or give gifts, and the appropriate value of gifts. 

• Create a gift register that everyone must use, whether they accept a gift or not. 

Appoint someone responsible, for example, a compliance officer or club treasurer to oversee policies, financial systems and reporting, conflicts of interest and gift register. 

Make sure they are police vetted and educated in preventing corruption and fraud.  

Carry out background checks on anyone who manages finances. Both the New Zealand Police Vetting Service and the Ministry of Justice criminal record check provide information on criminal convictions. Police vetting is more comprehensive as it also includes any charges not resulting in a conviction, and a person’s previous contact with police.  

Make sure everyone in the club or organisation knows all complaints and concerns will be handled fairly and taken seriously. Have a complaints page on your website that’s easy to find. 

• Have clear lines of reporting and actions for when people speak up.   

• Have a clear process to follow up complaints and concerns.  

• Respond to all concerns and complaints appropriately. Take them seriously, no matter how minor they might seem.