1. Introduction
1.1 Financial Crime, in the Proceeds of Crime Act 2002, (as amended by the Serious Crime Act 2015) covers any kind of criminal conduct relating to money or to financial services or markets, including any offence involving:
- fraud or dishonesty; or
- misconduct in, or misuse of information relating to, a financial market; or
- handling the proceeds of crime; or
- the financing of terrorism
1.2 This was originally aimed at professionals in the financial and investment sectors. However, it was subsequently recognised that those involved in criminal conduct were able to ‘clean’ the proceeds of crime through a wider range of business and professional activities – including council activities.
1.3 This policy provides measures to monitor, detect and prevent financial crime within `the Councils and to help put in place systems and controls which mitigate financial crime risk effectively.
1.4 To report any suspicion you have of any financial crime or related issues you can follow the Councils’ whistleblowing procedure.
2. Areas of financial crime
2.1 The areas where we particularly look for risks of financial crime are in relation to fraud, corruption, theft, bribery, and money laundering.
- Fraud – ‘the intentional distortion of financial statements or other records by persons internal or external to the authority which is carried out to conceal the misappropriation (misuse) of assets or otherwise for gain’.
- Corruption – ‘the offering, giving, soliciting, or acceptance of an inducement or reward which may influence any person to act inappropriately’.
- Theft – ‘appropriating property belonging to another with the intention of permanently depriving the other of it’.
- Bribery – ‘is an inducement or reward offered, promised or provided to gain personal, commercial, regulatory or contractual advantage’.
- Money laundering – ‘an activity which falls within the Proceeds of Crime Act 2002, (as amended by the Serious Crime Act 2015) whereby criminally obtained money or other assets are exchanged for clean money or assets with no link to their origins’.
- Whistleblowing – ‘when a person reports suspected wrongdoing at work. Officially this is called ‘making a disclosure in the public interest’’
3. How we aim to prevent financial crime
3.1 Culture
3.1.1 The Councils firmly endorse a culture of integrity and honesty and take a robust approach to any signs of financial crime. The Councils’ approach is to proactively and effectively manage the risk of financial crime and to minimise losses incurred by:
- Maintaining fully integrated policies
- Promoting a culture of honesty and propriety
- Deterring the risk of occurrence of financial crime
- Preventing risks that cannot be deterred
- Detecting risks that cannot be prevented
- Professionally investigating financial crime detected
- Applying sanctions against people who commit financial crime
- Seeking redress for assets defrauded
- Communicating with members, contractors, the public and partners making them aware of the policies and how to raise concerns
- Providing training and guidance to all employees and members.
3.1.2 Appropriate policies and procedures are maintained to ensure that internal controls are built into the Councils’ systems and processes to prevent or detect financial crime. There is an expectation and requirement that all contractors, suppliers, individuals and organisations associated in whatever way with the Councils will act with integrity and that Council staff and Members will lead by example.
3.1.3 Members and officers should demonstrate the highest standards of openness, propriety and integrity and lead by example by adhering to legally sound and honest procedures and practices. The prevention and detection of fraud or corruption, and the protection of the public purse, are everyone’s responsibility, both internal and external to the organisation.
3.2 Communication
3.2.1 The Councils’ Communications Team will optimise the publicity opportunities associated with financial crime activity within the Councils and will try to ensure that the results of any action taken, including prosecutions, are reported in the press.
3.2.2 Where the Councils have suffered a financial loss as a result of financial crime, in all cases the Councils will seek to recover the loss and advertise this fact, whether involving an officer or a Member.
3.2.3 All financial crime activities, including this Policy, will be made publicly available to make all staff and the public aware of the Councils’ commitment to taking action against financial crime, should it occur
3.3 Working with others
3.3.1 The Councils will continue to encourage the exchange of information with other organisations, in compliance with the General Data Protection Regulation, tailed by the Data Protection Act 2018, in respect of financial crime activities. These bodies can include:
- The Police
- External Auditors
- Chartered Institute of Public Finance and Accountancy (CIPFA)
- Financial Conduct Authority (FCA)
- Department of Works and Pensions (DWP)
- National Anti-Fraud Network
- Association of Local Authority Treasurers
- Society of District Council Treasurers
- Norfolk Treasurers Group
- Norfolk Chief Accountants Group; and
- Other Local Authorities.
3.3.2 This collaboration provides a base for combating potential criminal activity of a fraudulent nature against this and other public sector organisations.
3.3.3 With regard to the National Fraud Initiative (NFI) exercise and data matching techniques generally, the Councils have adopted the Cabinet Office’s Code of Data Matching Practice. All staff on the Councils’ payroll have been advised of data matching exercises and their rights under Data Protection legislation. In addition, data matching ‘warnings’ are included on such stationery as Benefit Claim forms, etc.
