Chair: Martin Gill

Marc McAuley – Head of Counter Fraud Operations at Chartered Institute of Public Finance and Accountancy
Helen Peters – Fraud & Investigations Manager at Cheshire West and Chester Council
Capt. Praveen Dahiya – Founder & Managing Director at InQuest Advisories Pvt Ltd

Key points

Marc McAuley noted that the nature of fraud has been changing for many years, and so has the response characterised by the development of new technologies and making more tools available, in short counter fraud has found new ways of working. Covid has accelerated digital transformation but for all the good things, not least in enabling easier access to new services and grants it has also facilitated fraud. Due to the need to deliver at pace shortcuts were taken, people were working from home with less supervision, regularly as part of new teams, often in new roles, and there was a big reliance on trust, not the best fraud prevention measure. Meanwhile counter fraud standards were introduced promoting industry best practices and providing a benchmarking opportunity for practitioners. But fraud has been occurring, and even though some has been factored into delivery costs as an inevitable consequence of acting speedily, questions will be asked. You will hear Marc discuss the pros and cons of incentivising investigations. His final message is to highlight the need now for the public sector to get its house in order but also to celebrate its successes.

Captain Praveen Dahiya starts by discussing the dual threats of internal and external frauds and discusses a Bank of India report which shows that frauds in India have increased dramatically, and the overall impact has been felt more in the public sector. You will hear Praveen discuss the lack of effectiveness of different controls; the difficulty of detecting anomalies; the lack of political will to act; the poor governance and accountability for problems; and the inadequacy of processes. The problem he notes is that in India there are too many benefactors from the chaos that exists. With reference to case studies he outlines the problems posed by disgruntled middle managers. And how procurement fraud, though rife, is difficult to detect because there are so many points in the process where it can occur. Covid has created problems, and the ensuing hardship adds to that. As a final comment he warns of the need to act or to perish.

Helen Peters notes that as a practitioner on the frontline the last 15 months have been all consuming, there has been pressure to pay out grants to help people and to purchase speedily (such as Personal Protection Equipment) and in such circumstances balancing this with appropriate due diligence has been testing. Such environments make things easier for fraudsters. More so because overnight staff were required to work from home; it was not possible to investigate face to face; some were seconded to different departments; new suppliers were needed; rules changed and often quickly; there were new pressures and fraudsters like these circumstances.  Standards can help, they provide a reference point. Helen is ambivalent about incentivising investigations. Now though the focus should be on rooting out fraud.

This webinar revealed another point, that post Covid we can expect a whole raft of frauds to be discovered, there will be pressure to uncover them, rightly so. The costs could be substantial and internal fraudsters are likely to be responsible for a lot. Blame will be apportioned, but it remains to be seen as to where it should be fairly placed. These were unusual times, will the various stakeholders in the ‘new normal’ recognise that? This panel seem sceptical.

Martin Gill
24th June 2021