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INVESTIGATION: Blue badge misuse among 14 suspected fraud cases

INVESTIGATION: Blue badge misuse among 14 suspected fraud cases

Fraud costs local councils in the UK an estimated £7.8bn every year, Image: Newcastle Chronicle

A report setting out how Redcar and Cleveland Council tackles fraud has revealed that 14 suspected fraud cases are under investigation.

The internal audit and counter fraud progress report delivered by the organisation Veritau to members of the council’s governance committee said 15 referrals of suspected fraud had been received between the start of the 2021/22 financial year in April and the end of August.

Of these 14 were being actively investigated.

Veritau provides so-called assurance services to several local councils, including Redcar and Cleveland, Middlesbrough and North Yorkshire County Council, carrying out internal audits and counter fraud work.

The report described how in June counter fraud staff and civil enforcement officers identified misuse of disabled parking badges in the borough during a joint exercise in which more than 55 ‘blue badges’ were checked.

Four cases were subsequently identified for investigation and are among the 14 suspected fraud cases.

Drivers properly using blue badges can be exempted from parking charges, pay reduced fees and are able to park in restricted areas, including on many double yellow lines.

Where misuse is identified, badges are confiscated and returned to the issuing local authority, while criminal action can also be undertaken.

A separate counter fraud framework report for councillors provided an assessment of fraud risks to the council with blue badge fraud only deemed to be a low risk.

Other areas were said to be of a high risk to the council, including adult social care fraud and council tax and business rates fraud, the latter category being said to account for 66% of all local government-related fraud from fraudulent discounts and exemptions being applied for.

The report said: “Revenue from council tax and business rates is a key income stream.

“Fraud in this area threatens this source of funding.

“The council employs a number of methods to help ensure only valid applications are accepted.

“This includes requiring relevant information on application forms, visits to properties where necessary, and an annual canvass requiring businesses to confirm that they continue to be entitled to a discount or exemption.”

Last year Redcar and Cleveland Council adopted a new counter fraud and corruption strategy and the fraud risk assessment covering the local authority was updated to reflect current and emerging fraud threats, including matters connected to the coronavirus outbreak.

In March government spending watchdog the National Audit Office said there had been a significant rise in the risk of fraud due to covid-19 with a number of financial schemes having been put in place to support businesses and the public during the pandemic, and providing hundreds of millions of pounds worth of funding.

Describing the local picture, the report said: “The council has been responsible for administering a range of support payments to business and residents during the covid-19 pandemic.

“While funding was provided by the central government, the council was charged with the responsibility of identifying genuine applicants and investigating and recovering incorrect payments.

“Robust application processes and verification checks were established to minimise the impact of fraudulent attempts to claim funds.

“Veritau has supported the council through investigation of suspected fraudulent claims.

“This work continues in 2021/22.”

Veritau said a “key objective” of the counter fraud team employed to assist the council was to raise awareness of fraud with staff and the public and to inform them of how to report it if they suspected it was happening.

It said fraud awareness training had been delivered to staff and work was ongoing to update the council’s website with information on how to report fraud.

Veritau’s report added: “When fraud is committed against the public sector, money is diverted from vital public services into the hands of criminals.

“Counter fraud work helps the council protect public money and ensure that funds can be used to provide services.”

 

Words: Stuart Arnold, Local Democracy Reporter


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