Introduction
The education sector includes a wide range of academic institutions in addition to organizational systems, accreditation organizations, examination boards, and a number of licensing auditing, and regulatory agencies. In this sense, the sector needs a big infrastructure, tens of thousands of workers, and vast quantities of resources.
Given the enormous amounts of money assigned to it and the challenges of regulation, examination, and control, the industry’s magnitude makes it vulnerable to corrupt practices. Poor educational outcomes are a result of corruption, which is defined as “the abuse of entrusted power for private gain,” in a variety of ways (Kirya, 2019, p.1). Thus, lax control of the establishment might lead to the accumulation of power within one small circle of people, embezzlement of school funds, misallocation of resources, and poor leadership.
Problem Identification
The given case study illuminates the issue of corruption in the education sector. The main character, Benjamin King, is a non-academic president at Thomas Mifflin University who was appointed to this position by the board committee that was pressured by Terry Forrester (Gearhart & Miller, 2020). The causes of the corruption issues are nepotism, bribery, and money embezzlement. The Board lacked cooperation and did not comply with workplace ethics. As was mentioned by one of the board members, the whole power was concentrated in the hands of a small circle of people. They argued that the President reports directly to them and direction for the campus, the financials, the personnel, all of it comes to them. The faculty members and students also addressed emails to protest the absence of participation from campus constituents, but their complaints were unanswered.
Therefore, the responsible parties are the trustees who failed to control the situation. Nevertheless, the university was impacted positively by the new president. The campus underwent a makeover, there were several fundraising accomplishments, high enrollment of students, and compensation increases for the educators. However, the problem is this does not imply that, with time, the growth of the fund is guaranteed. Considering that the president was getting accustomed to bigger expenses, there is a chance of escalation of the situation.
Background Information
There has been much research conducted on the matter of corruption, and many studies illuminate its presence in the education sector. For example, fraud is described by Kranacher and Riley (2019) as improper or illegal deceit meant to produce a financial or personal benefit. For example, “New Orleans public schools were so corrupt that the FBI had an office in the district’s administration building and notched nearly 30 convictions, including the former school board president who pocketed $140,000” (Butcher, 2020, para. 4).
The form of fraud perpetrated by teachers and employees at universities is known as occupational fraud, although there is no one word used exclusively to describe it in colleges and universities. Employee management, capital or data exploitation, payment deception, asset misappropriation, travel and subsistence fraud, and invoice fraud are all examples of occupational fraud (Baird & Elliott, 2018). Considering the president’s regular lavish trips, events, and personal purchases, such charges to the university account can be regarded as occupational fraud.
In this case study, corruption is seen in several examples. First, nepotism had an impact on the hiring and placement of educators (Kirya, 2019). The issue of nepotism and favoritism was seen when the question of finding the replacement for the president arose, and Forrester was eager to appoint his friend, King. Forrester was baffled as to why King’s name was not on the list of the recruitment experts. He was informed that the recruitment results had pointed to several extremely talented academic experts and corporate leaders, all of whom had doctoral qualifications and some background in higher education. These people believed that King’s application was severely constrained by the fact that he possessed neither. In this sense, the person with authority was able to pressure employees into considering his candidate without relevant experience.
In addition to nepotism, another example of corruption at the establishment is a deception that was used to gain authorizations and positions. In this sense, King was asked about his credentials and skills when going through the interview. The article by Denisova-Schmidt further indicates that there can be non-monetary corruption. One of the instances of corruption is a conflict of interests, wherein an individual must decide between the obligations and expectations of their post and their own personal ambitions (Denisova-Schmidt, 2018). In the given study, Mr. Forrester claimed that the applicant had an Honorary degree from one of the universities in the Emirates, which was a deception. The fact that King not only received a position but was offered a significant increase in the standard compensation is a clear sign of deception for personal gain.
The case then shows that the property of the educational establishment was used for personal purposes. The purposeful misappropriation or misapplication of an institution’s assets or funds for personal gain is defined as occupational fraud (Kranacher & Riley, 2019). The university’s new president used college-owned cars for personal reasons, such as his daughter’s wedding. However, it was not only the property that was used, but money embezzlement was involved as well.
Mr. King was known for his opulent lifestyle and inappropriate level of compensation, especially for such a candidate. In the case, it was mentioned that Mr. King bought the office for $15.000, which was charged as university expenses. Furthermore, King conducted a farewell party for his fellow board member, Forrester, which was not in the vicinity but in Honolulu, in a lavish resort. Lastly, the president charged his daughter’s wedding reception to the university, which was $79,580. In this sense, government-allocated money, as well as those generated locally by non-governmental organizations, were embezzled.
Moreover, auditors received bribes for failing to report financial fraud. As for monetary corruption, there must be a presence of financial cheating, such as “intentionally deceiving someone in order to gain an unfair or illegal advantage” (Denisova-Schmidt, 2018, p.64). In this sense, when a party acts in self-interest, intentionally deceiving others, it can be considered a corrupt action. After receiving the bill for the wedding, King asked the auditor to pay from the president’s discretionary foundation account and gave them tickets to the game, which can be considered a non-monetary bribe. As will be seen further, such monetary and non-monetary corruption violates the ethics and guidelines, making them occupational fraud.
Proposed Solutions/Recommendations
The solution for Thomas Mifflin University is first to hire a firm that conducts higher education searches to find the best qualifying candidate for the position of president. The next step is for the Board to play a bigger administrative role so that they can monitor the actions of the president. Lastly, there must be performance indicators a college president should be measured against since the lack of indicators will reveal little about the productivity of the responsible party. As for the scholarly opinion, Kirya (2019) claims that participatory budgeting, expenditure monitoring tools, and social assessments are just a few examples of transparency- and accountability-promoting methods that can be used in anti-occupational fraud approaches. Other examples include performance-based agreements, conduct codes, and salary reform.
Conclusion
Hence, lack of institutional supervision might result in the concentration of power in the hands of a select few, the theft of school finances, the improper use of resources, and subpar leadership. Nepotism, bribery, and financial theft are the root causes of corruption problems. The first step to solving the issue is to find the most qualified candidate for the job of president at Thomas Mifflin University by employing a company that specializes in higher education searches. For greater transparency, there can also be participatory budgeting, methods for monitoring expenditures, and social assessments.
References
Baird, J. A., & Elliott, V. (2018). Metrics in education—control and corruption. Oxford Review of Education, 44(5), 533-544. Web.
Butcher, J. (2020). Bad education: Why shocking public school corruption remains hidden. The Heritage Foundation. Web.
Denisova-Schmidt, E. (2018). Corruption, the lack of academic integrity and other ethical issues in higher education: What can be done within the Bologna process? In European higher education area: The impact of past and future policies (pp. 61-75). Springer, Cham. Web.
Gearhart, D.G. & Miller, M.T. (2020). Case studies in college leadership. New Forum Press.
Kirya, M. (2019). Education sector corruption: How to assess it and ways to address it. Education, 4(2019), 1-61. Web.
Kranacher, M. J., & Riley, R. (2019). Forensic accounting and fraud examination. John Wiley & Sons.