The trick is to somehow ensure all the other officers (A) care about avoiding the cost while (B) are not motivated to collectively lie for one-another.

It's not hard to imagine: Officer X does something bad through incompetence, Officer Y tells the truth about it, and then all the other officers take revenge on Y for "being a snitch" and "screwing our pensions."

Once that pattern is in place, it continues even when Officer X is committing crimes, not just making mistakes.