What to do if you suspect a loss or illegal act

By the Office of the Washington State Auditor

Washington state law (RCW 43.09.185) requires all state agencies and local governments to tell SAO as soon as they suspect a fraud or loss has occurred at their government. If your government is the target or victim of a suspected loss or illegal act, first of all: don’t panic!  SAO has an automated reporting process and resources to help guide you through every step.

First, follow these basic steps

1. Report the loss to SAO using the loss-reporting form on our website
2. Secure all original records related to the loss in a safe place
3. Notify others who need to know, such as other governing body members, your chief financial officer or your internal auditor
4. Notify your legal counsel
5. File a police report when SAO advises you to do so

Governments also need to report cybersecurity incidents that involve finances or financial records in any way.

Second, educate yourself

Use these SAO resources to better understand reporting requirements and what’s expected of you during the reporting process.

• General Loss Reporting Policy (PDF). This document outlines SAO’s established policies that further define loss reporting requirements. Download it to learn more about losses you are NOT required to report, ones you are required to report, and how cybersecurity incidents factor into loss reporting requirements.
• How and When to Seek SAO Approval for a Restitution Agreement. Read and follow this guidance before entering into any restitution agreement with an employee.
• SAO’s Preventing Fraud web page. This page includes a variety of trainings and resources geared toward preventing and detecting fraud.

For questions about fraud procedures or the fraud program, contact us at fraud@sao.wa.gov.