Council steps up fraud training in wake of bill for £13m scandal

ANTI-corruption training has been stepped up at Sheffield Council following the South Yorkshire Trading Standards Unit case where taxpayers were left with a £13m fraud bill.

Unit manager Mike Buckley was able to hide his department's losses from auditors and management even though the scale of the debt escalated dramatically before his death from a heart attack in late 2005.

The failure to identify his crimes left taxpayers across South Yorkshire with an unexpected bill for more than 13m.

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Now Sheffield Council has confirmed it is putting more money into anti-corruption training for managers, particularly in areas vulnerable to fraud.

Mr Buckley, an internationally respected scientist, worked with three businessmen to conduct fraudulent deals which involved overpaying for goods and then charging for 'services' so it appeared he was generating income for the department.

All three pleaded guilty to conspiracy to commit false accounting and are to repay the 285,000 profit they made.

But it has also emerged that Mr Buckley also used other techniques to make his unit's finances appear healthy.

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It is understood he would regularly add apparently unpaid invoices to his departments accounts in the last few days of each financial year, giving the impression the unit was due a substantial income.

Although Mr Buckley was not challenged, it is understood administrative staff in the external company which processed the documentation were aware his methods were unorthodox.

The state of the unit's finances and the scale of its losses were only discovered after Mr Buckley's death.

The unit had been developed into an apparently healthy business, offering specialist help to firms alongside the weights and measures services all councils must provide.

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It collapsed in 2006, shutting laboratories in Chapeltown, Sheffield. It appears Mr Buckley committed the fraud not for personal gain, but simply to keep the unit operating.

The four South Yorkshire councils all contributed to making up the shortfall, with Sheffield contributing the largest slice at more than 5m. A meeting is due to be held to establish exactly where responsibility for those debts should finally rest.

Sheffield Council will also in the next few months publish a report by an independent specialist into what went wrong.

However the authority has confirmed that it is now to spend more on counter-fraud training for some managers.

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Chief Internal Auditor Steve Gill said: "Since the events relating to SYTSU and the subsequent investigations, the council has improved its proactive counter fraud arrangements.

"These improvements include additional resources to promote counter-fraud training targeted at managers and areas with a perceived higher risk of fraud," he said.

Sheffield Council says staff within the unit also sidestepped normal controls. One was dismissed for gross misconduct.

The council say the events at the TSU were "complex" and involved criminal activity and there was no guarantee that council audit procedures alone would guarantee fraud or corruption would be detected.