Financial red flags didn’t faze councillors Committee told of cases
A case of suspected money laundering within Perth and Kinross Council was reported at some point in the past 12 months, the Perthshire Advertiser can reveal.
The case was revealed in a report written by the council’s chief internal auditor Jackie Clark and presented to the local authority’s audit committee last week.
But despite the seriousness of the allegation, not one elected member sitting on the seven-strong committee pushed officers for any further details.
No-one sought further information on other concerning statements in the report involving allegations made by whistleblowers and “a number of investigations” that had to be conducted last year either.
Councillor Xander McDade was the only member of the committee who asked a question in any way connected to any of these statements and that was only to ask whether members of the audit team could identify whistleblowers.
The report, which was a review of the council’s internal audit department’s work in 2017/18, said the year saw “a moderate level of audit activity” regarding its responsibilty to uphold the council’s anti-fraud and anti-corruption arrangements.
It then went on: “There has been one case where money laundering was suspected during the year, relating to concerns raised by officers during a routine financial assessment, and the relevant authorities were informed.”
No other details were provided in the body of the report as to what was found by the “relevant authorities”, however, and an appendix attached to the paper merely added that “unplanned” audit activity relating to “potential money laundering” was “completed” sometime in the last 12 months.
Elsewhere the same report also revealed four people contacted internal audit last year to make allegations but merely went on to say that “outcomes” resulting from these allegations had “fed into the updating of the audit universe”.
Under the heading ‘Whistleblowing Arrangements’ it said: “Four contacts were made with internal audit of a ‘whistleblowing’ nature within the year.
“These cases were resolved and, as there were no control implications arising, reports were not provided to the audit committee.
“The outcomes have fed into the updating of the audit universe and in the planning exercise for the 2018/19 internal audit plan.”
And under the heading ‘Investigations’ the report added: “The year 2017/18 saw a number of investigations requiring input from internal audit.
“Investigative work undertaken within the year has resulted in agreed improvements which will enhance the council’s internal control environment.
“Where there is scope for improvement to the control environment identified by investigations, this is reported to the audit committee.” Nothing, however, was reported to the committee last Wednesday.
... the relevant authorities were informed