TAXPAYERS were left £650,000 out of pocket when officials at a crisis-hit NHS trust fell victim to an email scam, The Yorkshire Post can reveal.
Staff at Rotherham NHS Foundation Trust made payments for invoices into a false account after being told bank details of a supplier had changed. The fraud was only discovered by managers when the unnamed supplier chased unpaid bills.
Bosses at the NHS trust, which has suffered a series of financial problems since 2010 which saw it plunge into deficit, have now changed their accounting procedures. South Yorkshire Police confirmed suspects have been identified, although no arrests have yet been made.
Details of the fraud have been obtained by The Yorkshire Post in an internal audit report by the consultancy firm, PricewaterhouseCoopers. It said the trust fell victim to the payment redirection fraud in December 2011 when a letter purporting to be from a supplier was received requesting the trust amend its bank account details.
“This letter was taken on face value and payments of circa £650k were made to the new bank account which belonged to the fraudulent party,” said the report. “When the fraud was discovered, management immediately implemented new processes and controls to mitigate the risk that the trust would again fall victim to this particular fraud.”
Changes to bank details are now independently verified and checked by at least three members of staff. Subsequent checks of 163 bank change request forms had found processes were being followed in all but one case.
The report added: “The system in place is working well and has prevented a second attempt to defraud the trust. This was identified in the first step of the process ie obtaining an independent phone number for the supplier and confirming that bank details hadn’t changed.”
South Yorkshire Police confirmed it had been investigating the “high-value email fraud” reported in December 2011, and added: “Suspects have been identified and officers are currently liaising with the Crown Prosecution Service and local law enforcement agencies.”
The fraud added to woes at the trust which has suffered financial problems since 2010 which came to a head 18 months ago. Failures to achieve cost efficiencies had already left it in the red, but the crisis was exacerbated by the introduction of a patient record IT project in June 2012, which led to millions of pounds in losses.
Its debts triggered intervention by the regulator Monitor and a team of American-led turnaround experts were controversially called in, triggering wholesale changes to senior management. The trust is only expected to return to making a surplus in July. It faces making more than £10m in savings in 2014-15 alone.