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Forensic Accountants Unearthed Original Anomalies – 6 December 2013

Member: Nifa

It was announced this week that a further charge has been made against five people in connection with alleged fraudulent activity at welfare to work company A4E, where forensic accountants first found “systemic fraud” in 2009. A routine internal audit found evidence of staff claiming for putting people forward for jobs that did not exist or qualify for payment and generally fabricating paperwork.

The men and women, all employees of the company, were originally charged with fraud but have now been charged with one count of conspiracy to make false instruments, contrary to the Criminal Law Act.  The forensic accountants were just doing their job when they picked up anomalies in the accounts, which led to a painstaking financial investigation and then a further audit by the Department for Work and Pensions of its commercial relationship with A4E.

The discovery is proof enough of the importance of a regular forensic audit but, apart from uncovering the fraud, the audit also led to the firm making “significant enhancements” to all its systems, which can only be a good thing.  The role of the forensic accountant is to investigate accounting entries and explain what has happened in various financial transactions.  Using specialist sophisticated software systems, these accountants can quickly pick up on anomalies and find the true position behind even the most cleverly disguised fabrication.

In this case, the accountants picked up on the alleged fraud, with the result that the CPS have decided to bring charges against the five people, who will appear in court in January, but forensic accountants are also used to prove innocence, so no doubt the defendants’ defence teams will also be making extensive use of their skills.

Author: Roger Isaacs – 6 December 2013

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