I have discussed fraud and the need to put in place preventative measures quite a bit of late, so it seems appropriate to look at the example of the Serious Fraud Office for lessons. I hasten to add, I don’t necessarily mean lessons which should be copied, let’s just say, lessons.
A bit of context first. An inquiry was carried out by a senior civil servant into the practices of the SFO as a result of accusations, including that money had been wasted on management consultants. Like I’m sure you will not be surprised to hear that the allegations were denied. Indeed it was claimed no money was spent on management consultants.
Subsequently, it came to light that management consultancy expenditure, rather than £0, was actually £1m over six months! Worse, the senior civil servant leading the inquiry could find no documentation regarding the basis of the award of the consultancy contracts, no minutes of the meetings were the appointments were made, and one of those who supposed to have participated in the award decision denied attendance at the discussion.
How on earth can any organisation demonstrate good governance, a fair procurement process, and defend allegations of fraud against that background?
I suppose you could also ask:
- How could one of those involved in the procurement decision separately be awarded £1m without the relevant approvals?
- How could a £3m IT contract be renewed without permission?
- How could £100,000 be spent on travel and hotel costs to support someone working from home?
I think the only people who could answer those questions would be the Serious Fraud Office but perhaps it’s best not to follow their example.