Menu
23/03/2012
Leaked Internal Audit Found 'Systematic Fraud' At A4e
A leaked document suggests that welfare-to-work firm A4e knew of widespread potential fraud and systemic failures by management to control it.
A confidential 2009 internal audit was obtained by BBC Newsnight and is understood to show that the auditors found staff claiming for putting people into jobs which did not exist, jobs which did not qualify for payment and fabricating paperwork.
A4e have responded by saying the report was only a raft document.
It said that as a result of the internal audit it had made "significant enhancements" to all its systems, including appointing external auditors. It added that further investigation had found only five irregular claims had been made, all relating to a single employee.
A4e said it had reported this to the Department for Work and Pensions' Risk Assurance Division and that the department had said it was satisfied the matter had been resolved and that its audit requirements had been met.
The Department for Work and Pensions, which was passed a copy of the leaked document on Thursday, issued a statement saying:
"The Work and Pensions Select Committee was made aware of this audit at the time and the department later received assurances from A4e that it had not uncovered any major issues."
After being passed a copy of the report on Thursday, the Department for Work and Pensions issued a statement saying:
"The Work and Pensions Select Committee was made aware of this audit at the time and the department later received assurances from A4e that it had not uncovered any major issues."
"…while the internal A4e document relates to programmes delivered by the previous government, our investigation into current contracts will ensure the issues this report raises have been fully addressed".
However MP Margaret Hodge, chair of the public accounts committee, said: "This appears to be devastating evidence of systemic fraud within A4e. Either A4e failed to act or to inform DWP, or they did inform DWP and the department failed to investigate properly.
"Whichever, it is completely unacceptable. Once again, I am urging the department to suspend all its contracts with A4e immediately."
A4e were responsible for placing unemployed people into work which was to last at least 13 weeks, with employers expected to sign a form confirming the job was real and that the employee would be working a minimum of 16 hours a week.
The auditors discovered that in offices across the country some of A4e's best recruiters were claiming for putting people into jobs that did not exist or did not qualify for a job outcome payment from the government, and fabricating paperwork to back up their claims.
They found that A4e staff thought there was "nothing wrong" with filling in forms that should have been completed by the employer for the claim to be valid.
The auditors concluded that 4% of the claims they examined were "potentially fraudulent" or included "irregular activity" and another 12% were classified as containing "reputational" or other risks.
They said that they could only be sure that A4e was entitled to the money the company claimed in 70% of the cases.
(H)
A confidential 2009 internal audit was obtained by BBC Newsnight and is understood to show that the auditors found staff claiming for putting people into jobs which did not exist, jobs which did not qualify for payment and fabricating paperwork.
A4e have responded by saying the report was only a raft document.
It said that as a result of the internal audit it had made "significant enhancements" to all its systems, including appointing external auditors. It added that further investigation had found only five irregular claims had been made, all relating to a single employee.
A4e said it had reported this to the Department for Work and Pensions' Risk Assurance Division and that the department had said it was satisfied the matter had been resolved and that its audit requirements had been met.
The Department for Work and Pensions, which was passed a copy of the leaked document on Thursday, issued a statement saying:
"The Work and Pensions Select Committee was made aware of this audit at the time and the department later received assurances from A4e that it had not uncovered any major issues."
After being passed a copy of the report on Thursday, the Department for Work and Pensions issued a statement saying:
"The Work and Pensions Select Committee was made aware of this audit at the time and the department later received assurances from A4e that it had not uncovered any major issues."
"…while the internal A4e document relates to programmes delivered by the previous government, our investigation into current contracts will ensure the issues this report raises have been fully addressed".
However MP Margaret Hodge, chair of the public accounts committee, said: "This appears to be devastating evidence of systemic fraud within A4e. Either A4e failed to act or to inform DWP, or they did inform DWP and the department failed to investigate properly.
"Whichever, it is completely unacceptable. Once again, I am urging the department to suspend all its contracts with A4e immediately."
A4e were responsible for placing unemployed people into work which was to last at least 13 weeks, with employers expected to sign a form confirming the job was real and that the employee would be working a minimum of 16 hours a week.
The auditors discovered that in offices across the country some of A4e's best recruiters were claiming for putting people into jobs that did not exist or did not qualify for a job outcome payment from the government, and fabricating paperwork to back up their claims.
They found that A4e staff thought there was "nothing wrong" with filling in forms that should have been completed by the employer for the claim to be valid.
The auditors concluded that 4% of the claims they examined were "potentially fraudulent" or included "irregular activity" and another 12% were classified as containing "reputational" or other risks.
They said that they could only be sure that A4e was entitled to the money the company claimed in 70% of the cases.
(H)
Related UK National News Stories
Click here for the latest headlines.
23 February 2012
A4e Had Jobseekers Work In Their Own Offices
A4e, the company at the center of a police investigation into the fraudulent misuse of government welfare-to-work contracts compelled jobseekers to work, for free, within its own offices.
A4e Had Jobseekers Work In Their Own Offices
A4e, the company at the center of a police investigation into the fraudulent misuse of government welfare-to-work contracts compelled jobseekers to work, for free, within its own offices.
25 September 2012
A4E Prison Education Contracts Delayed For Fraud Investigation
Multimillion-pound contracts to run education programmes in 25 prisons, due to be taken over by controversial welfare-to-work provider A4E, have been stalled while anti-fraud checks are carried out.
A4E Prison Education Contracts Delayed For Fraud Investigation
Multimillion-pound contracts to run education programmes in 25 prisons, due to be taken over by controversial welfare-to-work provider A4E, have been stalled while anti-fraud checks are carried out.
22 August 2012
A4e Not Allowed To Call Itself A 'Social Purpose Company'
A4e, the company at the centre of fraud allegations in relation to its government welfare-to-work contracts, has now been banned from calling itself a “social purpose company”. The restriction is to ensure consumers do not mistake the company for a not-for-profit organisation. The firm's website, mya4e.
A4e Not Allowed To Call Itself A 'Social Purpose Company'
A4e, the company at the centre of fraud allegations in relation to its government welfare-to-work contracts, has now been banned from calling itself a “social purpose company”. The restriction is to ensure consumers do not mistake the company for a not-for-profit organisation. The firm's website, mya4e.
07 March 2012
'Champagne Culture' Of A4e Revealed By Former Managers
Several former managers of A4e, the welfare-to-work company at the centre of fraud investigations, have told the Guardian newspaper the firm ‘has a culture of lavish trips abroad and big-spending hospitality.’ The company holds up to £180m worth of public contracts and all of its UK income comes from government contracts.
'Champagne Culture' Of A4e Revealed By Former Managers
Several former managers of A4e, the welfare-to-work company at the centre of fraud investigations, have told the Guardian newspaper the firm ‘has a culture of lavish trips abroad and big-spending hospitality.’ The company holds up to £180m worth of public contracts and all of its UK income comes from government contracts.
24 February 2012
A4e Chair Steps Down As Cameron Advisor
Emma Harrison, the chair of A4e has stepped down from her role as David Cameron's personal adviser on troubled families.
A4e Chair Steps Down As Cameron Advisor
Emma Harrison, the chair of A4e has stepped down from her role as David Cameron's personal adviser on troubled families.
-
Northern Ireland WeatherToday:A showery start with outbreaks most frequent north of Lough Neagh and through the morning, before dwindling during the afternoon as the northwest breezes ease and brighter spells of weak sunshine prosper. Maximum temperature 8 °C.Tonight:A dry night, save for a few light showers around the coasts, with prolonged clear spells and light winds bringing a frosty dawn for many in central and southern parts. Minimum temperature -3 °C.
