Councillors have been updated on investigations into Melton Council’s £205,000 payment into a fraudulent bank account.
Last month officers discovered a payment due to one of the council’s suppliers had been transferred to a fraudulent account.
It’s the largest fraud recalled within the council.
A police investigation and internal council probe are underway. There will also be a council review when more is known.
It’s thought unlikely the council’s insurance will cover the loss. A new crime policy is now being looked into.
POLICY FINANCE AND ADMINISTRATION COMMITTEE
7TH OCTOBER 2013
REPORT OF HEAD OF CENTRAL SERVICES
PAYMENT FRAUD
1.0 PURPOSE OF REPORT
1.1 To update members on the recent payment that was made into a fraudulent bank account.
2.0 RECOMMENDATIONS
2.1 That the Committee note the current position and the steps that have been taken to recover the funds and investigate the matters relating to how the event occurred.
2.2 That members note the availability of a Crime Policy for which a price is awaited from the insurers.
3.0 KEY ISSUES
3.1 On 4th September 2013 finance officers became aware that a payment due to one of its suppliers had not reached that suppliers bank account, and instead had been transferred to a fraudulent account. Steps were immediately taken to try and recover the monies in liaison with both the Council’s bankers and the police.
3.2 Police investigations have initially centred on the recovery of the payment although work has now started on the investigation itself. Council staff have been interviewed and information has and continues to be supplied to the Police on a range of issues as requested.
3.3 Following notification to the external auditors a discussion was held with PWC’s fraud expert who stated that the Council’s procedures for making amendments to standing data including bank account details were good but enhancements were suggested and these are to be implemented.
3.4 The Leader has requested that when further details are known from the investigation both internal and external, that a review be undertaken of the creditors function by the external auditors. Members of the Governance Committee at their meeting on 24th September 2014 considered how they wished to feed into the scoping of such a review. It was approved that should there be a need to approve the scope outside of a regular meeting then delegated authority be given to the Chair and Vice Chair to approve.
3.5 This appears to have been a well planned fraud. The Council needs to be mindful of not prejudicing the ongoing police investigation into this matter or indeed the internal investigation that has commenced. The position is constantly changing and members will be kept informed of developments subject to this not prejudicing the ongoing investigations.
Last month officers discovered a payment due to one of the council’s suppliers had been transferred to a fraudulent account.
It’s the largest fraud recalled within the council.
A police investigation and internal council probe are underway. There will also be a council review when more is known.
It’s thought unlikely the council’s insurance will cover the loss. A new crime policy is now being looked into.
POLICY FINANCE AND ADMINISTRATION COMMITTEE
7TH OCTOBER 2013
REPORT OF HEAD OF CENTRAL SERVICES
PAYMENT FRAUD
1.0 PURPOSE OF REPORT
1.1 To update members on the recent payment that was made into a fraudulent bank account.
2.0 RECOMMENDATIONS
2.1 That the Committee note the current position and the steps that have been taken to recover the funds and investigate the matters relating to how the event occurred.
2.2 That members note the availability of a Crime Policy for which a price is awaited from the insurers.
3.0 KEY ISSUES
3.1 On 4th September 2013 finance officers became aware that a payment due to one of its suppliers had not reached that suppliers bank account, and instead had been transferred to a fraudulent account. Steps were immediately taken to try and recover the monies in liaison with both the Council’s bankers and the police.
3.2 Police investigations have initially centred on the recovery of the payment although work has now started on the investigation itself. Council staff have been interviewed and information has and continues to be supplied to the Police on a range of issues as requested.
3.3 Following notification to the external auditors a discussion was held with PWC’s fraud expert who stated that the Council’s procedures for making amendments to standing data including bank account details were good but enhancements were suggested and these are to be implemented.
3.4 The Leader has requested that when further details are known from the investigation both internal and external, that a review be undertaken of the creditors function by the external auditors. Members of the Governance Committee at their meeting on 24th September 2014 considered how they wished to feed into the scoping of such a review. It was approved that should there be a need to approve the scope outside of a regular meeting then delegated authority be given to the Chair and Vice Chair to approve.
3.5 This appears to have been a well planned fraud. The Council needs to be mindful of not prejudicing the ongoing police investigation into this matter or indeed the internal investigation that has commenced. The position is constantly changing and members will be kept informed of developments subject to this not prejudicing the ongoing investigations.
