Report of: Head of Financial Services

Purpose of Report: To appraise Members of the activity and performance of the Counter Fraud Team for the fiscal year 1 April 2023 to 31 March 2024

Recommendation: That the report be noted.

Rob Ducker, Senior Investigation Officer, introduced the report which provided an overview of the performance of the Counter Fraud Team for the 2023/2024 fiscal year. He highlighted the successes that the team had in counteracting fraudulent behaviour in the housing sector and how these efforts have generated a significant level of income for the council. 

The Senior Investigation Officer also informed the committee of the work that the Counter Fraud Team had undertaken to raise awareness and educate people on best practice. To support these efforts, the Counter Fraud Team held their 8^th annual conference, with over 150 in attendance to help to educate and raise awareness and they further relationships with other authorities. The 9^th annual iteration of this conference is scheduled for November of this year and over 100 delegates are already booked on for this and the national conference, hosted in Birmingham the team attended last year. Rob Ducker stated that they would not be participating in this conference this year, but would be participating in a different national conference regarding fraud investigations.

Fraud Awareness Training was also offered to offered to ODS staff around Fraud Awareness; to recognize and report possibly fraudulent behaviour in properties that they visit. These trainings have increased referrals from ODS and have been viewed to be very successful.

In response to a question from Councillor Ottino, regarding the methods used to identify possibly fraudulent behaviour, it was explained how the team has implemented data from the National Fraud Initiative to identify housing applications with a risk of being fraudulent.

Councillor Roz Smith queried the trainings available to staff so that they can recognize instances of possible fraud and how these staff members are being acknowledged for the good work they are doing in making referrals. Additionally, Councillor Smith asked for more information regarding the proportion of referrals that are being made from each source. Councillor Smith also asked if Audit and Governance training could be available for new members, because of the particular language and references that are used in the committee.

Nigel Kennedy, Head of Financial Services, stated that there is a training session available to members. When this training was conducted, it was recorded, and this can be distributed to the members of Audit and Governance Committee.

The Senior Investigation Officer replied by stating that referrals come from a variety of sources. Rob Ducker stated that 70 – 80% come from the general public, via their website and that about 30% come from staff. It was also outlined that the fraud awareness training is given to all new starters and that they also have regular fraud awareness training for staff. It was stated that they would be open to holding further trainings for staff and Councillors, if needed, and that they recognize and celebrate the staff who are making referrals regarding instances of possible fraud.

Councillor Ottino noted how the figures presented compared to previous years; stated that there has been a year-on-year rise, so the rise seen this year is a continuation of an ongoing trend.

Councillor Fry asked how the Counter Fraud Team could engage with more local authorities and if demand for their services did increase, if they would have the capacity to take this on. The Senior Investigations Officer responded that they are always seeking to work with more local authorities and that although they are only currently working with four councils, they also with a range of housing associations. Additionally, if the workload grew, the team could expand and are currently considering the appointment of a Financial Investigator, because of the capabilities and benefits that such an appointment would bring to the team.

In response to a further question from Councillor Fry regarding cyber security experts, noting that ICT is the current lead on cyber security. Nonetheless, their team is working to learn more about this topic and they would be open to discussions about adding cyber security experts to their team.

The committee also commented on the success that the Counter Fraud Team has had in exceeding the targets that have been set. With that in mind, Councillor Fry asked if higher targets should be considered. Head of Financial Services stated that although there could be some room to raise targets, this would need to take into consideration the income generations that are one-off occurrences and will not happen year on year. 

Councillor Muddiman asked if there is any benefit to the Counter Fraud Team being made into a subsidiary. The Head of Financial Services responded that there had been discussions about this possibility, but that this would cost a considerable amount of expense to set up and advised that the current arrangement of the Counter Fraud Team is sensible to maintain.

Recommendations: Two recommendations came from the discussion of this report. The committee noted that they will consider reviewing the targets being set for the Counter Fraud Team. The committee also noted that they would like to have a fraud awareness training session for this committee and its members.

The Committee thanked the Senior Investigations Officer for presenting the report and

The Audit and Governance Committee noted the report.