Theft, falsification of timesheets, financial abuse and excessive use of the internet recorded within Sheffield Council

Sheffield Council said it has dealt with a wide range of fraud cases over the past year and warned fraud likely increased due to Covid-19.

Friday, 4th June 2021, 2:45 pm

Recorded cases of fraud within the council included theftof cash or assets, falsification of timesheets, financial abuse of service users, excessive use of the internet during work time and behaviour breaching the code of conduct across portfolios.

The council said as a result, there were a number of dismissals and resignations.

But it said the level of reported fraud within the council reduced in the past year as activity within certain areas of the council was reduced.

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Town Hall.
Town Hall.

It has also dealt with cases including phishing scams, Covid-19 grant frauds and housing fraud.

In a report ahead of an audit and standards committee meeting next week, council officers said: “It is recognised that each pound lost to fraud represents a loss to the public purse and reduces the ability of the public sector to provide services to the people who need them. It is likely that the level of fraud will have risen during 2020 as a result of the large volume of grants and other monies paid out by the government.”

Internal audit liaised with various organisations including banks, HMRC, DWP and the Insolvency Service in relation to Covid grant frauds or scams and recovered £35,000.

The council was awarded a significant number of grants by the government throughout the pandemic but the normal checks and balances were streamlined due to the necessity for grants to be handed out quickly.

Another significant fraud issue for the council is bank mandate fraud. Although it said it has robust controls in place to detect and prevent this, the council is still targeted by organised criminal gangs who undertake phishing exercises which are becoming more sophisticated.

The council also opened 155 new cases of housing tenancy and right to buy fraud – including obtaining property by deception and unlawful subletting – over the past year, which was more than double the previous year.

Council officers said: “Sheffield City Council has robust processes to try to prevent and detect fraud. These are available to all staff and have become embedded into council processes. This should reduce the amount of fraud and aid in its early detection. The work of Internal Audit should also reduce the prevalence of frauds, by ensuring services and processes have robust controls in place.”

One such measure is a fraud e-learning package that is available to all staff and councillors and take up rates are monitored.

According to the National Fraud Authority, public sector fraud costs taxpayers around £20.3 billion per year and research by Policy Exchange found fraud and error during Covid-19 will cost the government around £4.6 billion.

The level of fraud reported in Local Government in 2019 was approximately £253 million. This is down from £302m in the previous year whilst the average value per case has remained the same at £3,600. Figures for 2020 have not yet been made available.

Fraud will be discussed at the council’s audit and standards committee meeting on Thursday, June 10.