1.1The NHS Counter Fraud Service

Public Health Wales / Counter fraud and corruption policy and procedure
Counter fraud and corruption policy and procedure
Policy type: Public Health Wales wide policy
Policy reference number: PHW08
Policy classification: Corporate Governance
Author:Craig Greenstock, Counter Fraud Manager
Policy lead:Craig Greenstock, Counter Fraud Manager
Executive lead: Huw George, Director of Finance
Date:06February 2015 / Version:V2
Publication/ Distribution: Public (Internet)
Review Date: February 2018
Approval date: 07 May 2015
Approving body: Audit Committee
Purpose and Summary of Document: This policy is designed to promote an anti-fraud and corruption culture and to ensure that there are appropriate measures in place to deter, detect, prevent and investigate fraud. It aims to eliminate fraud and corruption within Public Health Wales as far as possible. The policy also provides a framework for responding to suspicions of fraud, together with advice and information on fraud, and the implications and outcomes of counter fraud investigations.
This policy is based upon the model policy produced for the NHS by the Local Counter Fraud Specialist and is intended as a guide for all staff on counter fraud work within the NHS. All genuine suspicions of fraud and corruption can be reported to the Local Counter Fraud Service or through the NHS Fraud and Corruption Reporting Line.
Intended audience: All staff and Non Executive Directors
Interdependencies with other policies:Whistleblowing policy, Local Counter Fraud Communications Strategy, Local Counter Fraud Specialist/ Human Resources Protocol, Declaration of Interests, Gifts and Hospitality policy.
Standards for health services in Wales: Standard 1 - Governance

Contents

1Introduction

2Policy aims and objectives

3Scope

4Legislative and national initiatives

4.1The Fraud Act 2006

4.2The Bribery Act 2010

5Definitions

5.1Fraud

5.2Common types of fraud

5.3Corruption

6Roles and responsibilities

6.1Chief Executive

6.2Director of Finance

6.3Local Counter Fraud Specialist

6.4Managers

6.5Staff

6.6Internal and external audit

6.7Human Resources

6.8Heads of Informatics

6.9Director of Communications

The Director of Communications is responsible for supporting the Local Counter Fraud Specialist in making staff aware of the Counter Fraud policy and of building a counter fraud culture in Public Health Wales.

7Public Health Wales approach to fraud and corruption

7.1The creation of an anti-fraud culture

7.2Maximum deterrence of fraud

7.3Successful prevention of fraud which cannot be deterred

7.4Prompt detection of fraud which cannot be prevented

7.5Professional investigation of detected fraud

7.6Effective sanctions, including appropriate legal action against people committing fraud and corruption

7.7Effective methods for seeking redress in respect of money defrauded

8Code of Conduct

9Reporting and dealing with fraud or corruption

9.1Reporting fraud or corruption

9.2Disciplinary action

9.3Police involvement

9.4Managing the investigation

9.5Gathering evidence

9.6Recovery of losses incurred to fraud and corruption

9.7Reporting the results of the investigation

9.8Action to be taken

9.9Timescales

9.10Recording

10Training

11Communication to staff

12Monitoring and auditing

13Review

14Information Governance statement

Policy changes

December 2014 / Policy reviewed and no changes proposed other than changes to contact information
18 February 2015 / Policy circulated to the Partnership Forum via e-mail.
07 May 2015 / Policy approved by Audit Committee

1Introduction

One of the basic principles of public sector organisations is the proper use of public funds. The majority of people who work in the NHS are honest and professional. They find fraud committed by a minority wholly unacceptable as it ultimately leads to a reduction in the resources available for the provision of services.

All members of staff have a duty to ensure that public funds are safeguarded and a duty to protect Public Health Wales from fraud, corruption or any other irregularity. Public Health Wales encourages anyone having reasonable suspicions of fraud to report them. If a member of staff has any concerns regarding fraud or corruption, or has seen any suspicious acts or events, they must report the matter to the nominated Local Counter Fraud Specialist, or the National Fraud Reporting Line or to the Director of Finance. Please refer to paragraph 9.1 of this policy or to Appendix 1 for further information.

Public Health Wales is committed to the rigorous investigation of any fraud allegations and to taking appropriate action against wrong doers. This includes disciplinary action and criminal prosecution when it is necessary.

To meet its objectives, Public Health Wales has adopted the seven-stage approach developed by the NHS Counter Fraud Service as outlined in Section 8 of this policy. This is designed to promote an anti-fraud culture and ensure that there are appropriate measures in place to deter, detect, address and prevent fraud.

1.1The NHS Counter Fraud Service

The NHS Counter Fraud Service (NHS CFS) which includes Counter Fraud Service Wales is part of NHS Protect, a business unit of the NHS Business Services Authority. It has responsibility for all policy and operational matters relating to the prevention, detection and investigation of fraud and corruption and the management of security in the NHS.All instances where fraud is suspected are properly investigated until their conclusion by staff trained by the NHS CFS. Any investigations will be handled in accordance with the NHS Counter Fraud and Corruption Manual.

2Policy aims and objectives

This policy aims to discourage and eliminate NHS fraud and corruption within Public Health Wales as far as possible. It also aims to encourage the prevention and detection of such acts. It is intended to provide direction and help to members of staff who may identify suspected fraud. It provides a framework for responding to suspicions of internal fraud, advice and information on various aspects of fraud and implications of investigation.

The main objectives of this policy are to:

Improve the knowledge and understanding of everyone in Public Health Wales about the risk of fraud and corruption within the organisation and its unacceptability;
Assist in promoting a climate of openness and a culture and environment where staff feel able to raise concerns sensibly and responsibly;
Set out Public Health Wales’ responsibilities in terms of the deterrence, prevention, detection and investigation of internal fraud and corruption;
Ensure the appropriate sanctions are considered following an investigation, which may include any or all of the following:
Internal/external disciplinary action;
Civil prosecution;
Criminal prosecution.

3Scope

This policy relates to all forms of fraud and corruption and is intended to provide direction and help to members of staff who may identify suspected fraud.

It is intended to provide a framework for responding to suspicions of fraud, advice and information on various aspects of fraud and implications of an investigation. It is not intended to provide a comprehensive approach to preventing and detecting fraud and corruption.

This policy applies to all Public Health Wales staff. The term staff encompasses the following: all staff, Non Executive Directors and other parties who may have a business relationship with Public Health Wales e.g. consultants, vendors or contractors.

4Legislative and national initiatives

4.1The Fraud Act 2006

Under the Fraud Act 2006 it is not necessary to prove that a person has been deceived. The focus is now on the dishonest behaviour of the suspect and their intent to make a gain or cause a loss.

The new offence of fraud can be committed in three ways:

Fraud by false representation (s.2) – lying about something using any means, e.g. by words or actions;
Fraud by failing to disclose (s.3) – not saying something when you have a legal duty to do so;
Fraud by abuse of a position of trust (s.4) – abusing a position where there is an expectation to safeguard the financial interests of another person or organisation.

All offences under the Fraud Act 2006 occur where the act or omission is committed dishonestly and with intent to cause gain or loss. The gain or loss does not have to succeed, so long as there is intent.

4.2The Bribery Act 2010

The Bribery Act 2010 came into force on 1 July 2011 and replaces former Anti-Bribery Laws with a suite of new offences which is markedly different to previous legislation. The Bribery Act 2010 makes it a criminal offence to “give, promise or offer a bribe and to request, agree to receive or accept a bribe either at home or abroad”. The maximum penalty for bribery is now 10 years imprisonment, with an unlimited fine.

In addition, the Act introduces a ‘corporate offence’ of failing to prevent bribery by the organisation not having adequate preventative procedures in place. An organisation may avoid conviction if it can show that it had such procedures and protocols in place to prevent bribery. The ‘corporate offence’ is not a stand alone offence.It always follows from a bribery and/or corruption offence committed by an individual associated with the company or organisation in question.

5Definitions

5.1Fraud

The definition for fraud used by NHS Protect is “the deliberate alteration of any financial statements or other records by persons, internal and/or external to the organisation, which is carried out in order to conceal the misappropriation of assets or otherwise for gain.”

5.2Common types of fraud

Some of the most common types of fraud which have been experienced by the NHS Counter Fraud Service, are as follows:

Overstated times on timesheets for hours not worked;
Staff working elsewhere despite having reported to be on sickness absence;
Non Declaration of previous criminal convictions on Curriculum Vitae (CV) or Application Forms;
Overstated qualifications and previous employment history on CVs or Application Forms;
Claiming for journeys not undertaken or expenses not incurred;
Using NHS revenue funds to purchase assets for own personal gain;
Sale of NHS equipment on Internet websites for own personal gain.

5.3Corruption

This can be broadly defined as the offering or acceptance of inducements, gifts, favours, payment or benefit-in-kind which may influence the action of any person.Corruption may not always result in a loss, e.g. a person may use their position to give some advantage to another and may not benefit directly from doing so.

It is a common law offence of corruption to bribe the holder of a public office.It is similarly an offence for the office holder to accept a bribe.

Corruption prosecutions are most commonly brought within specific legislation dealing with corruption:

the Public Bodies Corrupt Practices Act 1889;

the Prevention of Corruption Acts 1889–1916;
the Anti-terrorism, Crime and Security Act 2001.

6Roles and responsibilities

Public Health Wales has a duty to provide a secure environment in which to work, and one where people feel confident to raise concerns in good faith without fear of reprisal, recrimination or victimisation. This also extends to ensuring that staff feel protected when carrying out their official duties and that they are not placed in a vulnerable position. If staff have concerns about any procedures or processes, or aspect of work, that they are asked to be involved in, Public Health Wales has a duty to ensure that those concerns are listened to and addressed.

Staff are in the best position to recognise any specific risks within individual areas of responsibility. They have a duty to ensure that those risks – however large or small –are identified, attended to and eliminated.

6.1Chief Executive

The Chief Executive is liable to be called to account for specific failures in Public Health Wales’ system of internal controls. Responsibility for the operation and maintenance of controls falls directly to line managers but it requires the involvement of all of Public Health Wales staff.

Public Health Wales therefore has a duty to ensure that staff who are involved in or who are managing internal control systems receive adequate training and support in order to carry out their responsibilities. Therefore, the Chief Executive and Director of Finance will monitor and ensure compliance with this policy.

6.2Director of Finance

The Director of Finance, in conjunction with the Chief Executive, monitors and ensures compliance with Welsh Government directions regarding fraud and corruption. The Director of Finance will, depending on the outcome of investigations (whether on an interim/ongoing or concluding basis) and/or the potential significance of suspicions that have been raised, inform appropriate senior management accordingly.

The Director of Finance will inform the Head of Internal Audit at the first opportunity. If an investigation is deemed to be appropriate, the Director of Finance will delegate to Public Health Wales’ Local Counter Fraud Specialist, who has responsibility for leading the investigation, whilst retaining overall responsibility him/herself.

The Director of Finance or the Local Counter Fraud Specialist will consult and take advice from the Director of Workforce and Organisational Development if a member of staff is to be interviewed or disciplined. The Director of Finance or Local Counter Fraud Specialist will not conduct a disciplinary investigation, but the member of staff may be the subject of a separate investigation by Human Resources.

6.3Local Counter Fraud Specialist

In line with guidance from the Welsh Government, Public Health Wales is required to appoint and nominate a Local Counter Fraud Specialist (LCFS).

The role of the Local Counter Fraud Specialist is to ensure that all cases of actual or suspected fraud and corruption are notified to the Director of Finance and reported accordingly. The Local Counter Fraud Specialist will also ensure the day-to-day implementation of the seven generic areas of counter fraud and corruption activity as detailed in Section 7 below and, in particular, the investigation of all suspicions of fraud.

The Local Counter Fraud Specialist will regularly report to the Director of Finance on the progress of the investigation and when/if referral to the police is required.

It is the responsibility of the Local Counter Fraud Specialist, in consultation with the Director of Finance to report any case to the police or NHS CFS as agreed and in accordance with the NHS Counter Fraud and Corruption Manual.

The Local Counter Fraud Specialist has responsibility to:

Report any case and the outcome of the investigation through the NHS CFS’s national case recording system;
Ensure that other relevant parties are informed where necessary, e.g. Human Resources will be informed if a member of staff is the subject of a referral;
Ensure that Public Health Wales incident and losses reporting systems are followed;
Ensure that any system weaknesses identified as part of an investigation are followed up with management and reported to internal audit;
Adhere to the Counter Fraud Professional Accreditation Board (CFPAB)’s Principles of Professional Conduct as set out in the NHS Counter Fraud and Corruption Manual;
Not be in any way engaged in the management of security for any NHS body;
Ensure that the Director of Finance is informed of regional team investigations, including progress updates.

6.4Managers

All managers must be vigilant and ensure that procedures to guard against fraud and corruption are followed. They should be alert to the possibility that unusual events or transactions could be symptoms of fraud and corruption. If they have any doubts, they must seek advice from the nominated Local Counter Fraud Specialist.

Managers must instil and encourage an anti-fraud and corruption culture within their team and ensure that information on procedures is made available to all staff. The Local Counter Fraud Specialist will proactively assist with encouraging an anti-fraud culture by raising the awareness of fraud within Public Health Wales.

All instances of actual or suspected fraud or corruption which come to the attention of a manager must be reported immediately. It is appreciated that some members of staff will initially raise concerns with their manager. However, in such cases, managers must not attempt to investigate the allegation themselves.They have the clear responsibility to refer the concerns to the Local Counter Fraud Specialist as soon as possible.

Line managers at all levels have a responsibility to ensure that an adequate system of internal control exists within their areas of responsibility and that controls operate effectively. The responsibility for the prevention and detection of fraud and corruption therefore primarily rests with managers but requires the co-operation of all staff.

As part of that responsibility, line managers need to:

Inform staff of Public Health Wales’ code of business conduct and counter fraud and corruption policy as part of their induction process, paying particular attention to the need for accurate completion of personal records and forms;
Ensure that all members of staff for whom they are accountable are made aware of the requirements of the policy;
Assess the types of risk involved in the operations for which they are responsible;
Ensure that adequate control measures are put in place to minimise the risks. This must include clear roles and responsibilities, supervisory checks, staff rotation (particularly in key posts), separation of duties wherever possible so that control of a key function is not invested in one individual, and regular reviews, reconciliations and test checks to ensure that control measures continue to operate effectively;
Ensure that any use of computers by staff is linked to the performance of their duties within Public Health Wales;
Be aware of Public Health Wales‘ counter fraud policy and the rules and guidance covering the control of specific items of expenditure and receipts;
Identify financially sensitive posts to ensure that suitable controls are in place to prevent losses from occurring;
Ensure that these controls are being complied with through periodic reviews of how well they are operating;
Contribute to their Divisional Director’s assessment of the risks and controls within their business area, which feeds into Public Health Wales’and the Department of Health Accounting Officer’s overall statements of accountability and internal control.

6.5Staff

Public Health Wales’ Standing Orders, Standing Financial Instructions, policies and procedures place an obligation on all members of staff and Non Executive Directors to act in accordance with best practice.

Staff are expected to act in accordance with the standards laid down by their professional institutes, where applicable. They have a personal responsibility to ensure that they are familiar with them.