New team focused on helping to detect, analyse and recover public sector fraud loss

25-04-2018

Fraud takes many forms and is evolving all the time, growing in sophistication as technology improves and spreading whenever exploitable gaps in a system are found. For the public sector – already under pressure to absorb funding cuts, find efficiencies and manage increasing demand – fraud can have a very real impact on the ability to provide public services.

The true scale of loss to the public purse is difficult to accurately assess. According to the Annual Fraud Indicator 2013, which provides the last set of government sanctioned estimates, fraud costs the public sector at least £20.6bn annually. Within that there were a multitude of crimes, from tax and benefit fraud to corrupt procurement practices, and payroll fraud.

Recognising these considerable challenges, CIPFA set up the Counter Fraud Centre four years ago to create a centre of excellence dedicated to help, serve and equip the public sector with the knowledge, skills and tools to tackle fraud.

The Centre has become a lynchpin in the sector’s fight against fraud. As well as offering seven counter fraud qualifications, including two accredited by the Counter Fraud Professional Accreditation Board (CFPAB) and three international qualifications, the Centre has produced the Code of Practice on Managing the Risk of Fraud and Corruption; leads on the local government counter fraud strategy, Fighting Fraud and Corruption Locally; and each year produces a survey measuring the extent of fraud hitting public bodies, the CIPFA Fraud and Corruption Tracker (CFaCT). Add to that a long list of resources for public sector fraud teams (for example, a global risk register and anti-bribery and corruption e-learning) and fraud consultancy services.

Key to its success has been the wide network of organisations the Centre works with, including the National Audit Office (NAO), the National Crime Agency (NCA) and the Local Government Association (LGA), as well as fraud ambassadors in the private sector, such as Halo, Equifax, BAE, Moore Stephens and Mazars.

Time and again, these collaborations have shown that combining resources and sharing data is far more effective than working alone at combating a crime that crosses organisational and geographical boundaries. The Centre’s response to this has been the design of a new public sector counter fraud offer, the counter fraud hubs and with it a new team.

CIPFA identified and has appointed a team with a key mix of public and private sector expertise across local government fraud and international data analysis capability. This included a dedicated new post for Peter Wilson as the incoming director who joined from central government last year. Peter has a rich background in counter fraud from the Home Office, most notably, as Director of the National Fraud Authority and then building the renowned Research Information Communications Unit, which used innovative analytics to counter terrorism and serious organised crime including fraud.

CIPFA’s strong incumbent team, who had already been awarded the contract to run the London Counter Fraud Hub (LCFH), has been further enhanced with a dedicated local government fraud team led by Marc McAuley who brings 20 years of knowledge. Now with the pilot phase for London well underway and beginning to roll out, CIPFA has been able to commence bespoke pilots elsewhere in the UK on the back of learning to date and in conjunction with professionals up and down the country.

The LCFH is a data-sharing and analytics solution, which is being led by Ealing Council and London Councils and run by CIPFA, together with a number of partners. Recognising that a fraud does not often conform to borough boundaries, its premise is to use data stretching right across the capital to pinpoint fraud through the analysis of multiple datasets. Over the last ten months, CIPFA has been moving through the pilot phase (with Ealing, Camden, Islington and Croydon councils), testing the concept in three areas: single-person discount council tax (SPD), housing tenancy and business rates.

Early results from the pilot have been hugely encouraging, generating a higher number of alerts than originally anticipated. It is an exciting project that signals the Centre’s commitment to providing services and solutions that measurably impact the fight against fraud in the public sector.

For more details on the LCFH, contact the team at: lcfhenquiries@cipfa.org