The Accounts Commission warns Scottish councils to tighten fraud controls after a major theft at Aberdeen City Council
Aberdeen: A shocking case has come to light where a council worker managed to steal over £1 million without anyone noticing for 17 years. The Accounts Commission is now urging other councils in Scotland to take this as a serious warning.
Michael Paterson, who worked as a team leader for council tax and recovery, set up a sneaky way to issue refunds directly into his own bank account. Can you believe it? He pulled off 622 fraudulent refunds, racking up a total of £1,087,444 from 2006 to 2023.
He finally got caught when a colleague raised suspicions in September 2023, almost two decades after he started his scheme. Paterson was sentenced to four years in prison after admitting to embezzlement.
Fortunately, Aberdeen City Council believes they can recover all the stolen funds, so taxpayers won’t be left in the lurch. But the Accounts Commission is worried about how this could happen in the first place. They pointed out that the council’s fraud controls were not followed properly.
They stressed that councils need to have solid systems in place to monitor finances and act on any weaknesses found by auditors. Andrew Burns, the deputy chairman of the Accounts Commission, emphasized that all councils should take this as a lesson learned.
He praised the staff member who spoke up about the fraud, highlighting the importance of whistleblowing policies. It’s crucial for employees to feel safe reporting any suspicious activity.
An Aberdeen City Council spokesperson mentioned they will thoroughly review the findings from the Accounts Commission and will present a report to the council, including suggested actions to prevent this from happening again.
