Agenda item


To receive a report from the Director of Law and Governance providing the Counter Fraud Service Annual Report 2018/19.

(Report No.31)





RECEIVED a report from the Director of Law and Governance, presenting the Counter Fraud Service Annual Report.




1.    The report was presented by Gemma Young (Head of Internal Audit & Risk Management) and was the Annual report of the Counter Fraud team who prevent and detect fraud throughout the year.

2.    Overall, the team have identified   overpayments of £3.85M which is an increase of 60% over from the previous year (2017/18).

3.    The team had done a lot of work on Council housing, Right to Buy (RTB) and No recourse to public funds (NRTPF). Counter Fraud (CF) had supported Council housing and temporary accommodation teams in recovering over 100 properties.

4.    The CF team had denied 30 RTB applications equating to £3M. Often with denied RTBs other types of fraud are uncovered aswell i.e.  council tax fraud, housing benefit and sub-letting council properties.

5.    As detailed at Table A (pages 165-166 of the report), the section has levied 3 financial penalties for council tax fraud offences i.e. single person discount. As a result, 106 entitlements to single person discount were withdrawn and 3 financial penalties levied equating to £76k in income for the Council.

6.    In terms of the team’s pro-active exercises, a National Fraud Initiative (NFI) is currently being undertaken and the results will be reported back to the committee at the October 2019 meeting.

7.    The CF action plan has been in place throughout the year and includes a dedicated investigator within Children’s Services to look at every NRTPF claims that come in. This often uncovers safeguarding issues with claimants’ children. There are also 2 officers embedded within Council Housing and this arrangement seems to be working well.

8.    During 2018/19, the team had investigated 3 cases of whistleblowing.

9.    The following questions and queries raised in response to the report:

a.    Councillor David-Sanders commended Gemma Young for her good report. Outcomes were demonstrated, members could see monetary value behind the preventions and what the council is recovering. A good piece of work.

b.    The Chair enquired if the same targets are used every year. Gemma Young clarified that she now had an apprentice in the team with another in the new year so she would be well placed to stretch targets i.e. council housing may have a target of 75 as opposed to 60.

c.    The Chair asked how staff are trained and the policy delivered to officers as regards the whistle blowing policy. Gemma Young clarified that the policy is only on the Council web site and work needs to be done around the induction of staff and introducing them to counter fraud measures sooner. Gemma Young would like to encourage more staff to come forward where they have concerns. However, there had already been 3 cases of whistle blowing so far this year.

d.    Gemma Young responded to members regarding the resourcing of the CF team. The team were well resourced, including the arrival of 2 apprentices this year, but could always do with more as could other council services.

e.    Councillor Gunawardena required clarity regarding the £3m saving made from denying RTB claimants who are not qualified.  How many RTB properties were involved that equated to the saving of £3m.  The discount applied for RTB properties was £110.5k for each property and there were over 200 RTB properties involved.

f.     Peter Nwosu questioned who made the decisions around prosecutions as there seemed to be very few of these advertised. Did the council share data with other London Boroughs. Gemma Young clarified that with prosecutions, the team reviews cases and if they think the Council should prosecute, a file is prepared and sent to Legal Services. However, sometimes there are reasons why the Council decides not to prosecute i.e. chronic illness, disability, etc.

There are instances where data is shared with other London Borough’s via NAFIN. The Council is a member of NAFIN. The Council is also currently in a CIFAS pilot which not only involves local authority data, but also data from HMRC, Police and other agencies. The Council are also involved in the National Fraud Initiative (NFI) which is a statutory exercise (every 2 years) that shares data from all Local Authorities. The team were at the beginning of this journey regarding the sharing of data.

g.    The Counter Fraud team are only concerned with money laundering that comes into the Council. Local business money laundering is a Police matter.

h.    The Chair enquired about any pending fraud investigations there were and how many of these at present. Gemma Young would have to check the Case Management System and report back to the Committee.

ACTION – Gemma Young (Head of Internal Audit & Risk Management).


AGREED to note the outcomes of the work of the Counter Fraud Team for 2018/19.


Supporting documents: