Scams by civil service cost £12m

Published on Saturday 19 December 2009 19:18

GOVERNMENT staff have defrauded the taxpayer of more than £12 million over the past three years in a series of organised scams and expenses fiddles.

Treasury documents obtained by Scotland on Sunday reveal more than 3,000 cases of fraud involving civil servants have been uncovered between 2006 and 2009.

The biggest single scam involved a finance officer who stole 1.2m using fraudulent pay slips. The catalogue of crime also included the theft of hundreds of thousands of pounds by officials through false travel and hotel claims, in a manner reminiscent of the MPs' expenses scandal.

The amount of fraud carried out in 2008-9 was up by more than 70 per cent on the previous year, but even then, the Treasury admits, the analysis "does not represent a complete picture of the extent of fraud activity in departments."

Notable cases of fraud in the past year include:

&#149 An expenses scam involving 120 staff who filed false hotel and living costs amounting to 100,000 while abroad. They boosted their expenses by photocopying and tampering with receipts.

&#149 The theft by government staff of some 434,000 worth of goods, some of it stolen from shipping containers. The items included a 60,000 silver-mounted statue and six Land Rover engines. Some of the stolen material was sold by the perpetrators on eBay.

&#149 "A senior member of the Finance Team", who created a false company and a non-existent supplier and managed to channel 246,400 into it before being caught.

Most of the offences were straight theft, but the larger crimes related to so-called "payment fraud", where staff divert big sums of money earmarked for contractors or benefit claimants to themselves.

Matthew Elliot, for the Taxpayers' Alliance said: "This revelation is very concerning and it is all the more worrying that they could be the tip of the iceberg. The government needs to get a grip of its financial and audit procedures."

The figures relate to departments across the UK, and are not broken down by individual portfolio, making it impossible to ascertain which are the biggest culprits. The Treasury is now urging all departments to upgrade basic security.

A Treasury spokesman said: "The government takes the issue of employee fraud extremely seriously.

"We take every action possible to ensure the perpetrators are brought to justice, either through internal disciplinary measures or police action."