Business charge card update

Report: 15
Date: 2 December 2010
By: DPS Specialist Investigations on behalf of the Commissioner

Summary

This report updates members on the progress made in reviewing and investigating the potential misuse of MPS Amex charge cards. It is based on information from the MPA Counter Fraud Branch MPS Exchequer Services and MPS Directorate of Professional Standards.

A. Recommendation

That

1. Note the progress made by the Directorate of Professional Standards in reviewing and investigating the potential misuse of Amex charge cards within the MPS (including any non-MPS holders of MPS cards), as set out this report and
2. note the estimate of the likely time to complete the reviews and investigations by the Directorate of Professional Standards and resources required to do this, set out in paragraph 7 of the report.

B. Supporting information

Directorate of Professional Standards - Statistical Overview

1. All of the 195 category A files forwarded by MPA Audit have been reviewed by a DPS caseworker and an initial disposal sanction reached. In total 58 category A cases warranted a sanction being imposed or a formal investigation instigated.

2. The remaining 137 cases have been considered appropriate to be dealt with by no further action taken.

3. The following is a summary of the category A cases investigated by the DPS.

• Nine officers have been charged with criminal offences.
• Two of the officers charged have pleaded guilty at court to ‘Misconduct in a Public Office.’ One for £82,000 of personal spend, received a 10 month custodial sentence. One for £10,000 personal spend received 8 months suspended sentence, suspended for two years.
• One officer was found guilty of Conspiracy to Defraud the MPS on 19 October 2010 (sentencing on 22 November.) Two members of the public also charged were found guilty of Conspiracy to Defraud the MPS. These three persons were guilty of inflating rental costs of accommodation whilst officers were based in Leeds during 2005-2007. Compensation orders are being sought through the court to recover the £90000+ profit from this conspiracy.
• One of the officers charged pleaded ‘not guilty’ to misconduct in a public office in relation to £12,000 of personal spend. He was convicted of the offence but subsequently appealed. His appeal was successful however the appeal court directed that the officer be re-tried. This trial is due to be heard in January 2011. (This officer was dismissed prior to the first trial.)
• The case against one officer who had been charged has been discontinued. This case is now with the misconduct unit for consideration.
• One officer was found not guilty of fraud offences on the 4 November, this case is now with the misconduct unit for consideration.
• There are three separate criminal trials waiting to be heard in relation to Amex related investigations.
• One member of police staff was identified as using his Barclaycard for an excessive amount of personal spending. He has subsequently resigned from the service, receiving a criminal caution for theft.
• Five officers have appeared before misconduct hearings. Two officers received a formal reprimand. Two officers received the sanction of deducted five days pay. One officer received the sanction of four days pay.
• Six Officers and one member of police staff await full misconduct proceedings.
• Twenty four officers have received written warnings.
• One officer has received words of advice.
• Fourteen officers’ cases will receive no further action. This is due to a formal investigation ascertaining no substantive misconduct.

4. There are therefore no formal DPS investigations that are still to be concluded to the decision point of:- criminal charge being made, a misconduct sanction being appropriate or no further action being required. One case is still being investigated by the HR Practice Support Team who are investigating a member of police staff.

5. The timetable to complete the current ongoing investigations will be dependant on the judicial and discipline process. There are currently four fixed dates for criminal trials; two trials are scheduled for November 2010 while two trials are scheduled during January 2011.

6. The enquiry previously intended to provide all officers whose usage fell outside policy but did not constitute criminal or misconduct usage with a training and guidance letter. This course of action will not now be taken as it has been superseded by the new Barclaycard corporate card procedures, which all cardholding officers have been made aware of and have subscribed to.

7. The DPS currently supplies the staff and resources to complete this investigation and have the capacity to deal through to conclusion.

Organisational Learning

8. This review and investigation has identified significant organisational learning. Due to the recommendations made by the DPS, MPA Directorate of Audit Risk and Assurance (DARA) and MPS Exchequer Services, significant improvement of financial control has been introduced. These are outlined below.

9. A New corporate card was introduced in June 2008, in the form of Barclaycard. This has introduced new policies as a direct result of the Amex investigation, these have included:

• An initial review of all cardholders’ necessity to posses a charge card, followed by further annual reviews.
• A card limit annual spend imposed on cardholders, with 81% of cardholders having the minimum limit of £5,000.
• A system whereby the responsibility to ensure reconciliation has moved away from a central point of Exchequer Services. Each OCU finance and resource unit now has a responsibility to pursue reconciliation, with regular review meetings held between Business Finance Managers and Exchequer Services.
• A reduction from 90 days to 30 days to reconcile.

10. A new overseas travel allowance policy. This policy has removed the travel allowance element that includes hotel accommodation. All hotel accommodation must now be claimed through production of a receipt.

11. A new corporate hospitality policy that outlines clear parameters for spend.

12. MPS corporate cards are no longer issued to officers who are performing a role outside of the MPS, such as working for an ACPO Unit. In addition all non-MPS officers seconded into the MPS must receive sponsorship from a Superintendent, reviewed annually, to receive a card.

C. Other organisational and community implications

Equality and Diversity Impact

1. The equality and diversity implications of this investigation continue to be monitored by the Director of Resources and the Directorate of Professional Standards. There are not considered to be any adverse implications.

Consideration of MET Forward

2. This investigation supports the MET specialist and MET Standards strands of MET Forward increasing confidence internally and externally in the ability of the MPS to deal with the actions of its officers in a robust and transparent manner. Operation Cosperville demonstrates the MPS commitment to accept responsibility for the actions of its staff and proactively change processes when failures are identified.

Financial Implications

3. All costs for this review and investigation are currently being met from existing budgets. This has required a significant redirection of resources within Exchequer Services, DPS and the MPA DARA Counter Fraud Unit. Business Groups have also had to dedicate resources to support this process. Resources will continue to be allocated until the reconciliation and related investigations are completed.

4. It is standard policy to recover any money owed to the Authority for any reason. Action will be taken to ensure that all funds are recouped where appropriate subject to legal advice.

Legal Implications

5. There are no direct legal implications arising from this report, which is for information only.

6. This report refers to the investigation undertaken in relation to alleged misuse of Amex charge cards, and refers to cases resulting in criminal prosecution, and misconduct and disciplinary action taken by the MPA/MPS.

7. Where repayment of sums remains outstanding and it is not possible to deduct the monies from wages, files may be referred to DLS. It should be noted that the time limit to bring civil actions for debt is 6 years from when the debt arose, i.e. from when the unauthorised payment in question was made. Decisions on debt recovery will be made on a case by case basis.

8. This report provides openness and transparency in the way the MPS/MPA is handling this matter. It also provides confirmation that the MPS is committed to review and evaluate the way corporate cards are used, and ensure there are adequate governance arrangements in place.

Environmental Implications

There are no environmental considerations associated with this report.

Risk Implications

9. As outlined in this and previous reports, individual failings being identified and dealt with by criminal, discipline or civil process, minimising the risk of further misuse of the corporate card system. As outlined in this report, significant Organisational Learning has already been implemented resulting in the risk of repetition being minimised.

D. Background papers

• None

E. Contact details

Report author: Commander Mark Simmons

For information contact:

MPA general: 020 7202 0202
Media enquiries: 020 7202 0217/18

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