A4e hit by fresh allegations of an “unethical culture” and “systemic fraud”

Embattled ‘welfare-to-work’ company A4e has been hit by fresh claims of fraud and impropriety this morning, reports Shamik Das.

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Embattled ‘welfare-to-work’ company A4e has been hit by fresh claims of fraud and impropriety this morning.

Today’s Telegraph reveals that in secret evidence to a Parliamentary committee on Tuesday, A4e’s former head of audit, Eddie Hutchinson, provided documentation showing how an “unethical culture” led to “systemic fraud” at the company, which still holds several government contracts, despite being stripped last week of its Mandatory Work Activity contract in the south-east.

A4e-Emma-Harrison-money-grubbing-cheat
The session of the public accounts committee where Hutchinson made his claims was held in camera following protests from Tory MPs. He also says another welfare to work provider, Working Links – which runs three major contracts on the coalition’s £5 billion jobs scheme – is also lacking in probity.

The whistleblower alleges:

• A bonus scheme for employers “drove inappropriate behaviour” by staff willing to commit fraud;

• Staff acted in the belief that if their irregularity was discovered, they could resign in the knowledge no further action would be taken;

• Two years on from a 2009 audit report warning fraud was not confined to one part of the country, fraud was still “systemic”.

With the Telegraph adding:

In his evidence, Mr Hutchinson claimed that the leaders of both companies [A4e and working links] oversaw a “disgraceful misuse of government and taxpayer funding”, characterised by unethical behaviour, mismanagement, inadequate corporate governance and risk management and excessive payments in salaries.

An auditor with 30 years’ experience, Mr Hutchinson’s statement discloses that despite his discovery of an “ever-increasing volume of frauds”, with two or three new allegations arising on some days, the company failed to act. It cultivated a culture that discouraged employees from revealing improper practices, the document states.

“I encountered unethical behaviour or wrongdoing that fell way below standards that should be expected of organisations funded by significant sums from the public purse,” he wrote.

The repeated incidents of malpractice in the sector have led to a “multi-billion pound scandal”, he claimed in his statement.

 


See also:

Fired! Government gives disgraced A4e the boot 15 May 2012

Charity survey slams the shambolic failure of A4e 1 May 2012

The ‘Youth Contract’ – where the government hands million-pound contracts to companies like A4e 2 Apr 2012

New report reveals “devastating evidence of systemic fraud within A4e” 22 Mar 2012

The document A4E doesn’t want you to see 5 Mar 2012

A4e: Corruption, fraud and the £200m failure to help the unemployed 2 Mar 2012

A4e’s fall from grace has been in the pipeline for two years 2 Mar 2012


 

Last night, the public accounts committee said it will “insist that the allegations are fully investigated and results of the investigation published”, while A4e and Working Links both denied Hutchinson’s claims; A4e insisted none of the allegations “stand up”, with Working Links saying they “firmly reject any assertion of widespread fraud within our business”.

As with the sundry other probes into the company, and the criminal investigations against several individuals, only with the passing of time will A4e’s denials be tested and the truth be known.

 


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50 Responses to “A4e hit by fresh allegations of an “unethical culture” and “systemic fraud””

  1. Val Leeming

    A4e hit by fresh allegations of an “unethical culture” and “systemic fraud”, reports @ShamikDas: //t.co/VlJQuiDH

  2. nobrightside

    RT @leftfootfwd: #A4e hit by fresh allegations of an “unethical culture” and “systemic fraud”, reports @ShamikDas: //t.co/aXPz3lI6

  3. lisburnOrange

    A4e hit by fresh allegations of an “unethical culture” and “systemic fraud”, reports @ShamikDas: //t.co/VlJQuiDH

  4. Tristram Wyatt

    A4e hit by fresh allegations of an “unethical culture” and “systemic fraud”, reports @ShamikDas: //t.co/VlJQuiDH

  5. WorkfareProtest

    A4e hit by fresh allegations of an “unethical culture” and “systemic fraud” – //t.co/9ClgSdGM

  6. Andy McGill

    “@leftfootfwd: #A4e hit by fresh allegations of an “unethical culture” and “systemic fraud”, reports @ShamikDas: //t.co/dtf2BkVf” GOOD!

  7. Martin Steel

    A4e hit by fresh allegations of an “unethical culture” and “systemic fraud”, reports @ShamikDas: //t.co/VlJQuiDH

  8. Dawn Willis

    A4e hit by fresh allegations of an “unethical culture” and “systemic fraud”, reports @ShamikDas: //t.co/VlJQuiDH

  9. DisabilityArtsOnline

    A4e hit by fresh allegations of an “unethical culture” and “systemic fraud”, reports @ShamikDas: //t.co/VlJQuiDH

  10. Hovellin' Hermit

    A4e hit by fresh allegations of an “unethical culture” and “systemic fraud”, reports @ShamikDas: //t.co/VlJQuiDH

  11. Edd S.

    A4e hit by fresh allegations of an “unethical culture” and “systemic fraud” – //t.co/9ClgSdGM

  12. Margybargy

    A4e hit by fresh allegations of an “unethical culture” and “systemic fraud”, reports @ShamikDas: //t.co/VlJQuiDH

  13. Brian Tomkinson

    A4e hit by fresh allegations of an “unethical culture” and “systemic fraud”, reports @ShamikDas: //t.co/VlJQuiDH

  14. Warren O'Keefe

    Frm earlier: #A4e hit by fresh allegations of an “unethical culture” and “systemic fraud”, reports @ShamikDas: //t.co/VlJQuiDH

  15. Nancy Kelley

    A4e hit by fresh allegations of an “unethical culture” and “systemic fraud”, reports @ShamikDas: //t.co/VlJQuiDH

  16. Eric Greenwood

    This is after the dwp found them innocent of all fraud, Apart from the 8 people arrested, apart from the other 11 being investigated by the dwp now.. And they have used it was just an individual for the 5th time, it was one office, that it was a historic scheme so that somehow absolves them of all responsibility. Of course A4e will deny it, they make Hundreds of Millions from it, they arent going to say yes you are right.. i will have to give back all the money we took from the state..

    “Staff acted in the belief that if their irregularity was discovered, they could resign in the knowledge no further action would be taken;” this very fact is wrong on so many levels. Wrong is WRONG, you break the law, and from what i can see fraud is against the law (maybe they are going to add a clause saying but not in historic cases).. How many so called individuals commiting fraud does it take for people to think its systemic, 1, 2, 8, 20, 200, 3,500.. ONE person commiting fraud is One person too many,

  17. Noxi

    RT @leftfootfwd #A4e hit by fresh allegations of “unethical culture” + “systemic fraud” reports @shamikdas: //t.co/zoyJVXBs #workfare

  18. False Economy

    RT @leftfootfwd: A4e hit by fresh allegations of an “unethical culture” and “systemic fraud” //t.co/hATfJc5L #workfare

  19. Oxford Kevin

    RT @leftfootfwd: A4e hit by fresh allegations of an “unethical culture” and “systemic fraud” //t.co/hATfJc5L #workfare

  20. Julie Newman

    Frm earlier: #A4e hit by fresh allegations of an “unethical culture” and “systemic fraud”, reports @ShamikDas: //t.co/VlJQuiDH

  21. Peter Pannier

    RT @leftfootfwd: A4e hit by fresh allegations of an “unethical culture” and “systemic fraud” //t.co/hATfJc5L #workfare

  22. Innerwisdom

    RT @leftfootfwd: A4e hit by fresh allegations of an “unethical culture” and “systemic fraud” //t.co/hATfJc5L #workfare

  23. Bruce Ford

    RT @leftfootfwd: A4e hit by fresh allegations of an “unethical culture” and “systemic fraud” //t.co/hATfJc5L #workfare

  24. toby

    “@FalseEcon: RT @leftfootfwd: A4e hit by fresh allegations of an “unethical culture” and “systemic fraud” //t.co/ORKbQ6mL #workfare”

  25. BevR

    RT @leftfootfwd: A4e hit by fresh allegations of an “unethical culture” and “systemic fraud” //t.co/QsBvoFWG

  26. John COYB Syme

    A4e hit by fresh allegations of an “unethical culture” and “systemic fraud” – //t.co/9ClgSdGM

  27. WishforBetter

    RT @leftfootfwd: A4e hit by fresh allegations of an “unethical culture” and “systemic fraud” //t.co/hATfJc5L #workfare

  28. Fiona McMahon

    RT @leftfootfwd: A4e hit by fresh allegations of an “unethical culture” and “systemic fraud” //t.co/hATfJc5L #workfare

  29. alastair

    RT @FalseEcon RT @leftfootfwd: A4e hit by fresh allegations of an “unethical culture” and “systemic fraud” //t.co/dM4QDZ2B #workfare

  30. Ironmouse

    RT @leftfootfwd: A4e hit by fresh allegations of an “unethical culture” and “systemic fraud” //t.co/hATfJc5L #workfare

  31. ApprenticeSupermkt

    A4e hit by fresh allegations of an “unethical culture” and “systemic fraud”
    //t.co/egXV7IbP

  32. Debbie Huxton

    A4e hit by fresh allegations of an “unethical culture” and “systemic fraud”
    //t.co/egXV7IbP

  33. Janet Graham

    A4e hit by fresh allegations of an “unethical culture” and “systemic fraud”, reports @ShamikDas: //t.co/VlJQuiDH

  34. H. O.

    RT @leftfootfwd: A4e hit by fresh allegations of an “unethical culture” and “systemic fraud” //t.co/bkGP2sHL

  35. Ken Rice

    RT @leftfootfwd: A4e hit by fresh allegations of an “unethical culture” and “systemic fraud” //t.co/u9yd07fp

  36. Solomon Hughes

    (1) Hutchinson’s evidence is pretty devastating for A4e – but worth noting his evidence is also very damaging indeed for Working Links – you could read more about them here if you like –
    //www.morningstaronline.co.uk/news/content/view/full/118264 – which does strongly suggest the whole “Benefit Busting” industry is structurally flawed (to put it politely)
    (2) Also worth noting that A4e have already admitted – in 2010 – that their bonus scheme was a “driver for individual malpractice’ -their proposed solution (group bonus schemes) was not necessarily effective, especially as Hutchinson describes groups of staff creating false job claims

    //www.publications.parliament.uk/pa/cm200910/cmselect/cmworpen/101/101we08.htm

  37. Anonymous

    Oh god I go down and sign up after telling then and showing them why I need to use a wheelchair, they decided I would be suitable cleaning windows, they actually said I could clean the windows at the bottom. Then after telling I’ve a restricted driving license they sent me to a lorry driving center parking lorries, I could not even get into the dam thing.

    Then nothing silence by all accounts I was working in some factory, the idea was I was doing a day release, only nobody had told me about it.

    All these people Remploy Shaw Trust are all the same./

  38. cameronsfollys

    [This is being carefully hidden!] A4e hit by fresh allegations of “systemic fraud” //t.co/ihiJ4JLJ #Profiteering //t.co/df52ofYd

  39. Wordocalypse

    [This is being carefully hidden!] A4e hit by fresh allegations of “systemic fraud” //t.co/ihiJ4JLJ #Profiteering //t.co/df52ofYd

  40. Ruby Red

    RT @leftfootfwd: A4e hit by fresh allegations of an “unethical culture” and “systemic fraud” //t.co/hATfJc5L #workfare

  41. BevR

    RT @leftfootfwd: A4e hit by fresh allegations of an “unethical culture” and “systemic fraud” //t.co/QsBvoFWG

  42. paul and lynn hewitt

    RT @leftfootfwd: A4e hit by fresh allegations of an “unethical culture” and “systemic fraud” //t.co/QsBvoFWG

  43. Simon

    RT @leftfootfwd: A4e hit by fresh allegations of an “unethical culture” and “systemic fraud” //t.co/QsBvoFWG

  44. Mark Smithson

    RT @leftfootfwd: A4e hit by fresh allegations of an “unethical culture” and “systemic fraud” //t.co/QsBvoFWG

  45. Robert Sparey

    RT @leftfootfwd Working Links & A4e hit by fresh allegations of an “unethical culture” and “systemic fraud, reports : //t.co/dtFZ9dmT

  46. Blarg1987

    This shows the problem with a system of outsourcing jobs, the oublic sector is their to provide the best service possible with the resources available, the private sector is there to make as much money as possible from the least resources possible.

    Would be interesting to know of the increase in taxation over the last 10 years how much is down to profit from outsourcing I am sure we could ask the TPA to do a report :P.

  47. Anonymous

    The problem is, so far, that belief has been correct.
    Will the government fix this? (Will pigs sprout wings and fly?)

  48. Philip Sharratt

    I doubt Govt will allow Work Programme to collapse after A4E but options are narrowing with contagion //t.co/lIr5qPJ9 #in

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    […] at the Olympics if they declined the opportunity to work at the Jubilee celebrations. See also: • A4e hit by fresh allegations of an ‘unethical culture’ and ‘systemic fraud’ 24 May […]

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