Scrutiny Committee - 13/12/2017

At a MEETING of the SCRUTINY COMMITTEE held at Dundee on 13th December, 2017.

Present:-

BAILIES

COUNCILLORS

Bailie Derek SCOTT, Depute Convener, in the Chair.

The minute of meeting of this Committee of 27th September, 2017 was held as read.

Unless marked thus * all items stand delegated.

I DECLARATION OF INTEREST

No declarations of interest were made.

II EXTERNAL INSPECTION REPORT FOR WHICH ALL GRADES ARE GOOD OR BETTER

There was submitted Report No 437-2017 by the Executive Director of Children and Families Service reporting on the findings of the recent external inspections on Gillburn Road and The Junction young people's homes.

The Committee:-

(i) noted the summary of the inspection reports on Gillburn Road and The Junction which received grades of good or better in all areas covered by the inspection; and

(ii) remitted to the Executive Director of Children and Families to ensure that the areas for improvement, requirements and recommendations included in the reports were acted upon, both in relation to the particular services inspected and as guidance on good practice for other services.

III INTERNAL AUDIT REPORTS

There was submitted Report No 422-2017 by the Senior Manager, Internal Audit, providing the Committee with a summary of the Internal Audit Reports finalised since the last meeting of this Committee.

The Committee agreed to note the information contained within the report.

IV BI-ANNUAL REPORT ON COMPLAINTS

There was submitted Report No 425-2017 by the Chief Executive reporting on complaints statistics for the first half of 2017/2018, with comparisons to previous periods, and on the actions which continued to be taken to ensure that complaints were handled well and to learn from complaints.

The Committee noted:-

(i) the key performance indicators on complaints closed between 1st April, 2017 and 30th September, 2017, with trends from previous periods;

(ii) the latest update from the Complaints Review Group which meets quarterly to check the quality of complaints handling and to promote learning and process improvement from complaints;

(iii) the results of the satisfaction surveys sent to everyone who made a complaint closed during the first half of 2017/2018, with trends from previous surveys;

(iv) a summary of the annual letter from the Scottish Public Services Ombudsman on complaints received about the Council during 2016/2017, which highlighted that two complaints reached the Ombudsman's investigation stage of which one was partially upheld; and

(v) that a programme of training for employees on dealing with complaints was underway, and would reinforce the importance of dealing promptly with complaints, keeping complainants informed and giving clear explanations of decisions.

V FRAUD INCIDENT

There was submitted Report No 446-2017 by the Executive Director of Corporate Services providing details on the serious fraud carried out by ex-employee, Mark Conway, and action subsequently taken to ensure that the internal controls were strengthened and the risk of recurrence significantly mitigated.

The Committee noted:-

(i) the background to, and the sophistication of, the Mark Conway case along with the immediate sequence of events and corresponding timelines that followed the initial discovery;

(ii) the steps that had been taken to significantly mitigate the risk of recurrence within the Council;

(iii) that the ex-employee, Mark Conway, pled guilty on 2nd August, 2017 to embezzling 1.065m from the Council and on 24th August, 2017 at the High Court in Glasgow was sentenced to 5 years 4 months imprisonment;

(iv) that, with the exception of 10,000 excess, the Council had recovered the 1.065m, in full, plus 47,141 towards the PwC fees of 55,804; and

(v) the 2017/2018 Internal Audit Plan contained two specific reviews, BACS and User Access Levels, to give assurances to members and senior management around the related control environments. Going forward, as part of the 2018/2019 Internal Audit Plan, a resource would be set aside to formally follow-up on all recommendations made by PwC to ensure that they had been implemented as intended.

The Committee further agreed:-

(vi) to note that, whilst the guilty party was clearly Mark Conway, the legislation around money laundering seemed to have been ineffective in this case, and the Committee therefore instructed the Chief Executive to write to the Building Society/Bank concerned and ask how they allowed irregular payments of large sums of money to be paid into an individual's private accounts without question and also to write to Her Majesty's Treasury pointing out this fraud and that financial institutions either did not apply money laundering legislation or that it is ineffective and as a result a major fraud on the public purse had been committed, and asking the Treasury what actions they intend to take as a result of this;

(vii) to note that, apparently the money gained by these fraudulent means was used to pay for a gambling addiction using online gambling sites, and the Committee therefore instructed the Chief Executive to write to the Gambling Commission and the Department of Culture, Media & Sport highlighting that a major fraud has been committed against the public purse and online gambling companies were complicit in this by allowing an individual to apparently spend over 1 million of public funds on gambling and ask the Gambling Commission and the Department of Culture, Media & Sport what actions they intend to take as a result of this fraud.

Derek SCOTT, Depute Convener.