Counter Fraud Response Plan

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1.      Introduction

The Counter Fraud Response Plan, is a key document in the City of Bradford Metropolitan District Council’s Counter Fraud framework. The plan sets out the most common types of fraud, corruption and theft, stakeholder responsibilities and the arrangements for employees of the Council and/or the people and communities of Bradford District to report any concerns of fraud, corruption or theft being committed against the Council.

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2.      Examples of fraud, corruption and theft

The most common types of fraud, corruption, theft committed against the Council can be grouped as follows:

2.1   Occupation / Employee

Recruitment – occurs, for example, when a job applicant inflates their credentials to apply for a position; provides a false employment history or provides false or misleading references

Financial statement – occurs, for example, when:

• an employee or elected member provides false information to support an expenses claim;
• an employee works for another employer whilst receiving sick pay;
• an employee abuses the Councils flexitime or leave scheme;
• an employee or elected member deliberately manipulates or misreports other financial information,
• an employee or elected member deliberately fails to follow the Council’s financial procedures for their own gain.

Asset misappropriation – occurs, for example, when

• an employee, elected member or 3rd party steals the Council's property (including cash or other assets)
• an employee purchases goods for personal use through council suppliers
• an employee uses Council equipment or assets for personal use, for example Council vehicles, stock, equipment, computers, mobile phones or internet access

2.2  Council Tax and Non Domestic Rates

Council Tax; Council Tax Reduction Scheme; Council Tax Single Person Discount When someone who is liable to pay Council Tax deliberately gives false or misleading information so that they can pay less or no Council Tax.

Business Rates When a sole trader or a company deliberately gives false or misleading information so that they can pay lower or no business rates including stating that a property is no longer in use and therefore qualifies for a reduction in rates.

2.3  Disabled Parking (Blue Badge)

Misuse, abuse or defrauding the Blue Badge scheme is when someone

• Uses a badge which is no longer valid
• Uses a badge when the badge holder is deceased
• Uses a badge that has been forged or copied
• Uses a badge that has been reported lost or stolen
• Uses a valid badge belonging to a friend or relative for own personal use

2.4  Housing

Council or Social Housing - Tenancy Fraud

This occurs when someone deliberately gives false or misleading information when applying for a property, for example:

• falsely claiming to have children;
• subletting a property without permission;
• living in a property after someone has died without the right to do so;
• key selling – where a resident is paid to pass on their keys in return for a one off payment;
• false right to buy/acquire.

2.5  Adult Social Care

Direct payment – occurs when, for example,

• payments are not spent on items detailed in the care plan;
• false claims for expenses and wages are made by carers;
• a disability or care need is exaggerated to receive support;

Savings and capital are not declared on a financial assessment

2.6  Procurement

This occurs when someone deliberately intends to influence any stage of the procure to pay life cycle in order to make a financial gain or cause a loss. This could be perpetrated by contractors or sub-contractors external to the Council and/or staff within the organisation.

2.7  Public Funding and Grant

This occurs when individuals, organisations or organised criminal groups claim public funding or grants that they are not eligible for.

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3.0 Stakeholder responsibilities

Chief Executive

• Ultimately accountable for the effectiveness of the Council’s arrangements for countering fraud and corruption

Monitoring Officer

• Advise Members and Officers on ethical issues, standards and powers to ensure that the Council operates within the law and statutory Codes of Practice.
• Maintain whistleblowing reporting arrangements

Section 151 Officer

• Develop and maintain the Counter Fraud Framework, supported and approved by the Governance and Audit Committee
• Report significant matters of fraud or financial irregularity to the Head of Paid Service (Chief Executive), the Executive and the Governance and Audit Committee
• Develop and implement the Counter Fraud Framework and ensure cases of suspected fraud reported are promptly investigated
• Make recommendations to improve controls and reduce the risk of fraud in the future
• Ensure that where fraud is found proportionate action is taken for sanctions and redress

Governance and Audit Committee

• Review the assessment of fraud risks and potential harm to the Council from fraud and corruption
• Monitor the effectiveness of the Councils counter fraud measures including the Council’s Corporate Investigations Unit
• Promote high standards of conduct amongst Officers and Members

Members

• Support and promote the development of a strong counter fraud culture
• Ensure fraud awareness learning is completed bi-annually

External Audit

• Subject to the concept of materiality, provides reasonable assurance that the financial statements are free from material misstatement, whether caused by fraud or other irregularity.

Internal Audit

• Ensure that, where fraud or financial irregularity has occurred, appropriate controls are in place; any control weaknesses identified and recommendations made to improve the control environment.

All Directors and Heads Of Service

• Ensure that all counter fraud framework policies are adhered to
• Assess the risk of fraud, corruption and theft in departmental and service areas
• Reduce fraud risks by implementing strong internal controls
• Ensure all suspected fraud or financial irregularity is reported in accordance with the Fraud Response Plan
• Ensure all employees have taken the fraud awareness learning at least bi-annually.

All Managers

• Ensure that all counter fraud framework policies are adhered to
• Ensure all suspected fraud or financial irregularity is reported in accordance with the Fraud Response Plan
• Ensure all employees have taken the fraud awareness learning at least bi-annually.
• Ensure, when undertaking an investigation under the Council’s disciplinary procedures, that if the investigation involves potential fraud, corruption or theft, immediate contact must be made with the Corporate Investigation Unit, prior to the commencement of the investigation, to assess whether the nature of the allegations fall within the scope of the Fraud Response Plan. Managers should only proceed once this advice has been received (which may include an agreement on which issues should proceed and others which should not). This will ensure that, as far as possible, any evidence collected will not adversely impact any potential criminal investigation.

Human Resources Advisors and Business Partners

• Ensure that suspicions of fraud, corruption or theft are referred to the Corporate Investigation Unit at the earliest possible opportunity and certainly before any actions are instigated.

Public, Partners, Suppliers, Contractors and Consultants

• Be aware of the possibility of fraud and corruption against the Council and report any genuine concerns/suspicions in accordance with this plan

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4.0 Reporting a concern

Where an employee, elected member, member of the public, contractor or other 3rd party suspects that fraud, corruption or theft is occurring then they should report their suspicions immediately as follows:

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5.0 Investigation process

The Corporate Investigations Unit (CIU) are responsible for investigating allegations of fraud, corruption, theft or any other financial irregularity for the Council.

Where an investigation is to be carried out by the CIU, the Assistant Director / Director of the Service will immediately be notified of the scope of the investigation.

Where the allegation is about an employee which, if proven, could constitute gross misconduct then this will be highlighted for the Assistant Director / Director of the Service so that they can consider the options, for example suspension from duty.

All investigations will be carried out by appropriately trained investigators and conducted in accordance with the relevant Council policies, procedures and legislation and will always ensure the security, privacy and integrity of the evidence collected and that it is presented as appropriate for use at internal or external hearings and / or the Courts.

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6.0 Conclusion of an investigation

On completion of a CIU investigation, a report will be prepared for the Assistant Director/ Director of the Service detailing the investigation outcome and any evidence gathered to support the outcome.

Where the CIU investigation has a finding of fraud, theft, corruption or any other financial irregularity any required follow up action will be taken by the CIU, in accordance with the Council’s sanction policy.

In addition, the report may contain recommendations for actions management need to take and this may include (not an exhaustive list):

• Instigating a management investigation
• Improving identified weakness in system controls to reduce the risk of reoccurrence.
• Recovering any identified financial loss through the appropriate mechanism. Summary information about the incidence of fraud and corruption and the outcomes of investigations will be presented in the annual fraud

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7.0 CIU performance reporting

A report on the performance of the CIU is presented to CMT and the Governance & Audit Committee on an annual basis. Additionally, reports are produced for Departments and Services on a quarterly basis to help them identify fraud patterns and trends allowing them to, where appropriate, address any weaknesses in service delivery.

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8.0 Review

The Fraud Response Plan will be reviewed biannually.