Fraud risk management at B.C.'s $16-billion Site C dam project can be improved: auditor

Photo: The Canadian Press

The Site C Dam location is seen along the Peace River in Fort St. John, B.C., Tuesday, April 18, 2017. A new report from B.C.'s auditor general concludes BC Hydro has not established a fraud risk management program for the Site C dam project, although it has some elements in place. THE CANADIAN PRESS/Jonathan Hayward

British Columbia's auditor general says Crown-owned BC Hydro can improve its management of potential fraud risks at the $16 billion Site C dam project.

Michael Pickup says an audit found the Crown corporation has some elements of fraud management in place for the hydroelectric project but has not established an overall program for Site C, which is slated for completion in 2025.

Pickup's audit says the Global Infrastructure Anti-Corruption Centre warns the risk of fraud increases with the size and complexity of large infrastructure projects, because it becomes harder to compare costs and detect corruption.

The audit did not look for or investigate possible instances of fraud, but makes five recommendations to improve fraud risk management, including implementing policy and investigation procedures, staff training, regular assessments and evaluating effectiveness.

Pickup says BC Hydro accepted the audit's recommendations and its board of directors approved a fraud risk policy last January.

Hydro says it has completed three separate internal audits of Site C with no major findings, and it regular analyzes payment data for potential fraud.

"Enhancing existing risk management at Site C with robust fraud risk management could strengthen anti-fraud culture and benefit other projects," Pickup said in a statement. "It could also support BC Hydro's reputation as a careful builder and provider of hydroelectric energy."