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b) Vendor monitoring will also include checks to determine that DEAP clients are not billed for credit status as outlined in the vendor agreement with the contractor agency.

2) Investigation: Contractor agencies must investigate all reports and/or findings of vendor abuse or misappropriation of funds. Investigation of vendor fraud will involve the following activities:

a) Trace payments to vendors by contractor agency on behalf of client to vendor records to determine that DEAP payments were credited in full to the appropriate client. b) Trace amount invoiced by the vendors to determine that DEAP payments were credited in full to the appropriate client accounts. c) Determine that the amounts invoiced were only for home energy costs when client accounts include such items as gasoline, machine parts, oil, etc. It is okay to pay for furnace cleanings and tune-ups with the clients’ DEAP benefit. d) Determine that payments from clients or other sources do not overlap with DEAP funds (i.e., vendors must not be paid more than once for the same service. e) Determine that service provided by vendors are within contract time frames (i.e., invoices must not include charges for FAP services before October 1 or after the billing period ends.

3) When contractor agency investigations appear to confirm suspicions of vendor fraud, the agency must inform the vendor of the evidence. Every attempt should be made to allow the vendor to discuss the validity of the evidence. If the vendor does not concur with the evidence presented, the contractor agency shall hold an agency conference at which the vendor may present his/her own rebutting evidence. If the agency conference fails to remove the suspicion of fraud, the contractor agency must refer the case through the DSSC/OCS to the State Department of Justice and provide the supporting documentation.

C. Agency Staff Fraud a) Internal Controls: Contractor agencies must have in place internal controls which present and identify misappropriation of DEAP funds by agency staff persons. These controls must include a separation of duties