1.1 This Policy applies to all Mid and East Antrim Borough Council employees (permanent, temporary and voluntary).

Note for Elected Members:

If an Elected Member has concerns regarding malpractice, he/she is advised to refer to the Northern Ireland Code of Conduct for Councillors or seek the advice of the Chief Executive.

2. Background

2.1 This Policy outlines the commitment Mid and East Antrim Borough Council (hereafter referred to as ‘The Council’) places on the prevention and detection of fraud and irregularity, financial or otherwise.

2.2 All public servants are required to act honestly and with integrity, to safeguard the resources for which they are responsible and are required to conduct themselves in accordance with the seven principles of public life, set out in the first report of the Nolan Committee “Standards in Public Life”:

•  Selflessness;
•  Integrity;
• Objectivity;
• Accountability;
• Openness;
• Honesty; and
• Leadership.

2.3 The opportunity to commit fraud is ever-present and must therefore be a concern to all members of staff.

It is everyone’s responsibility to prevent fraud and follow the Council’s procedures where fraud is suspected or detected.

2.4 Fraud of any kind will not be tolerated within the Council.

All suspected frauds will be thoroughly investigated with the aim of establishing the facts.

All cases of suspected or detected fraud should be reported immediately to the relevant person, as detailed in section five of this Policy.

Such cases will be fully investigated and followed up.

Every effort will be made to recover losses from fraudulent activity.

Where fraud is proven, appropriate disciplinary action will be taken.

2.6 The Code of Conduct also provides a framework for equality issues, tendering, hospitality, gifts, sponsorship and corruption.

2.7 With reference to corruption, the Code highlights that for an officer of Council, it is a serious criminal offence to receive or give any gift, loan, fee, reward or advantage for doing, or not doing anything, or showing favour or disfavour to any person in their official capacity.

If an allegation is made, it is for the employee to demonstrate that any such rewards have not been corruptly obtained.

3. Definition of Fraud

3.1 CIPFA defines Fraud as:

“The intentional distortion of financial statements or other records by persons, internal or external to the organisation, which is carried out to conceal the misappropriation of assets or otherwise for gain”.

Individuals outside, as well as inside the Council, can perpetrate fraud.

An attempt to commit fraud is a criminal act and is therefore treated as seriously as accomplished fraud.

3.2 The Fraud Act (2006) states that fraud can be committed in the following ways:

• Fraud by false representation;
• Fraud by failing to disclose information; or
• Fraud by abuse of position.

3.3 Concerns which should be reported include, but are not limited to, staff committing or attempting to commit:

• any dishonest or fraudulent act;
• forgery or alteration of documents or accounts;
• misappropriation of funds, supplies or other assets;
• impropriety in the handling or reporting of money or financial transactions;
• profiting from an official position;
• disclosure of official activities or information for advantage;
• accepting or seeking value from third parties by virtue of official position or duties; and
• theft or misuse of property, facilities or services.

3.6 Frauds may be suspected or detected in a number of ways, including the following:

• By line managers or their staff applying the Financial Control Code or departmental internal control procedures;
• By internal audit;
• By the Northern Ireland Audit Office;
• By allegations from a third party.

3.7 All matters will be dealt with in confidence and in strict accordance with the terms of the Public Interest Disclosure (Northern Ireland) Order 1998.

This statute protects the legitimate personal interests of staff.

4. Aims of Fraud Policy

• To ensure staff use public funds entrusted to them in a responsible and lawful manner.
• To avoid legal challenge to the Council.
• To help ensure all staff working in the Council act with honesty and integrity at all times.
• Ensure Council complies with the current accounting standards.
• Prevent abuse of public resources, whether by third parties, or the Council’s own staff.
• To take all reasonable steps to prevent fraud within Council.
• Ensure all cases of fraud, or attempted fraud, against the Council are thoroughly and promptly investigated.

5.1 The Policy links to the core values as outlined in Council’s Corporate Plan 2019 - 2023.

Respect:

Establishing a culture of openness, trust and value.

Integrity:

To support the spirit which enables honesty, accountability and trust throughout.

6. Responsibilities

6.1 Council Responsibility

a. Under Article 35(1)(c) of the Local Government (Miscellaneous Provisions)(NI) Order 1992, the functions of the Local Government Staff Commission include ‘establishing and issuing a code of recommended practice as regards conduct of officers and Councils’.

b. Although the Accounting Officer bears overall responsibility and is liable to be called to account for specific failures, these responsibilities fall directly on management and may involve individual members of staff.

c. Fraud awareness training is part of staff induction and the Council is committed to providing ongoing training at appropriate levels on the issue of preventing fraud.

6.2 Staff Responsibilities

a. Failure of an employee to comply with the requirements of this policy may be considered a disciplinary matter and may be dealt with under Council’s Disciplinary Procedure.

b. All financial transactions must be processed and authorised in accordance with the procedures laid down in the Council’s Finance Policy Manual and accompanying procedures.

Every member of staff is expected to make sure that public funds are safeguarded, whether they are involved with cash or payments systems, receipts, stocks or dealings with contractors or suppliers.

c. Being alert to the possibility that unusual events or transactions could be indicators of fraud and alerting management where they believe the opportunity for fraud exists.

Appendix 1 provides examples of fraud indicators. In addition, common methods and types of frauds are included at Appendix 2, with examples of good management practice which may assist in combating fraud in Appendix 3.

d. Staff should alert their line manager where they believe the opportunity for fraud or abuse exists because of poor procedures or lack of effective control.

If procedures are not improved, the Director of Finance and Governance should be contacted.

Every effort will be made to protect the identity of the informants.

e. Where a member of staff suspects or detects fraud, they are required to immediately inform their line manager, who in turn is required to notify the Chief Executive or Director of Corporate Services.

f. If the member of staff feels unable to raise a particular concern with their line manager, for whatever reason, they are required to raise the concern with their Director, who in turn is required to notify the Chief Executive or Director of Corporate Services.

g. If these channels have been followed and the member of staff still has concerns, or the member of staff feels that the concern is so serious that they cannot discuss it with any of the above, they are required to discuss their concern directly with the Chief Executive or Director of Corporate Services.

h. If a member of staff feels that they cannot discuss their concerns with any officer in the Council they are required to refer the matter to the Chair of the Council’s Audit Committee, or Council’s Internal or External Audit contacts, whose details can be found under Section 12 of this Policy.

i. Staff should also assist in any investigations, by making available all relevant information and by cooperating in interviews.

Staff should treat all information relating to any investigation as confidential.

j. If staff are unsure what steps to take, they should ask their manager.

k. The responsibility for the prevention and detection of fraud or abuse rests primarily with managers and supervisors throughout the Council, who should always be alert to the possibility of fraud or attempted fraud.

l. Managers are responsible for ensuring that an adequate system of internal control exists within their areas of responsibility and that mandatory controls are being complied with and are operating effectively.

Where concerns exist, these should be notified promptly to the Director of Corporate Services.

m. Managers are also responsible for:

• Identifying the risks to which systems and procedures are exposed;
• Assisting to develop and maintain effective controls to prevent and detect fraud;
• Ensuring that controls are being complied with;
• Ensuring the organisations objectives are achieved; and
• Ensuring that there is adequate separation of duties to ensure that total control of key functions are not vested in one individual.

n. Managers should be alert to the possibility that unusual events or transactions could be symptoms of fraud or attempted fraud.

Irregularities/fraud may also be highlighted as a result of specific management checks or be brought to management’s attention by a third party.

o. Staff must also be aware of the provisions for ‘Whistleblowing’ as detailed in “The Public Interest Disclosure (NI) Order 1998”, which allows staff to qualify for protection if they have a reasonable belief that there has been an instance of fraud or attempted fraud and disclose this.

p. For a disclosure to be protected under the Public Interest Disclosure Act an employee must follow the procedures laid down in the legislation, make the disclosure in good faith and to the appropriate authority.

For example, disclosures can be made to the contacts that are defined within Council’s Fraud Policy, Internal/External Audit, etc.

Disclosures made to the media may not fall under the protection of the Public Interest Disclosure Act.

q. The Council has a ‘Raising Concerns Policy’ which can also be referred to.

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