Agenda item

Members considered the Annual report on identified fraud during 2020/21 and the proactive measures undertaken to counter fraud during the year and for the following year.

The report provided an overview of fraudulent activity during 2020/21, the details of which were contained in Section 3 of the report.

The report also sought to inform Members of counter-fraud activity, and to provide assurance and demonstrate that the Authority continued to have a robust counter-fraud culture and effective counter-fraud arrangements in place, ensuring fraud risks were managed effectively.  Sections 4 and 6 set out proactive work undertaken this year and the planned programme of pro-active work for the year to come.

Debate ensued and Members posed a number of questions. Reference the number of fraud cases identified in West Lindsey which was much lower in comparison to both the Lincolnshire and national average, whilst this was a positive situation, Members questioned why this might be the case?

Members also noted that during the Covid period the approach to debt recovery had been more lenient and questioned whether this could be a factor in the low number of fraud cases identified.

In response Members were advised that due diligence was undertaken on all applications for monies, whether that be a benefit application or an application for grant funding. Robust internal controls were in place and high assurances had been received on all relevant audits, as such, Officers were confident that procedures were in place to identify suspected fraud cases.

The recent Business Grant scheme had identified a number of high-risk individuals and companies, all of which had been investigated on an individual basis, and reported to the National Fraud Agency where appropriate.

Members raised three areas where they considered it would be useful to have additional information in future years these being: -

*        Cyber and IT crimes, due to their high profile nature in recent times and increased reliance on IT systems and on-line working;

*        Procurement Fraud,  particularly given the emergency arrangements which had been in place, seeking Assurance that all procurement undertaken on behalf of West Lindsey was in accordance with procedure; and

*        Working from home, which had the potential to open up new fraud opportunities.

In response Officers indicated they were happy to include information on those areas future reports. Assurance was also given that appropriate firewalls were in place to safeguard IT systems from cybercrime. These had proved successful to-date and continued to be monitored and updated appropriately.

Procurement procedure rules were in place and the authority worked closely with procurement Lincolnshire, in ensuring those procedures were effective. In terms of working from home all high risk systems had within them a segregation of duties. For example, a person placing an order was not permitted to authorise the same order for payment.

All audits undertaken during the pandemic relating to internal controls had received good audit assurances. Whilst noting the assurance provided in respect of systems and finance there were still concerns raised around the possibility of confidential information being disclosed as a result of home working.

Assurance was offered that all staff had been fully appraised of the risks around data disclosure. Computers were configured to lock screen within a very brief amount of time. Officers had also been provided with headsets for use within the home environment.  It was however accepted that this was an area that needed to continue to be monitored.

RESOLVED that: -

(a)         the anti-fraud work undertaken during 2020/2021 and the fraudulent activity identified thereby be noted;

(b)         Members are assured that the Council’s anti-fraud work has been, and will continue to be, sufficiently robust and effective; and

(c)          the proposed anti-fraud work to be undertaken during 2021/2022 be supported.