Serco investigated for fraud
According to the Guardian, Justice Secretary Chris Grayling has called in the City of London police to investigate alleged fraud by Serco staff working on a £285m contract to transport prisoners to and from courts across London and East Anglia.
The Ministry of Justice (MoJ) said detailed audit work initiated as a result of the investigation into the tagging contract in July 2013 had shown that some Serco staff were recording prisoners as having been ready for court when in fact they were not. The data was used as a measurement of performance which determined whether or not the contract was to be terminated.
It was thought the "potentially fraudulent behaviour" had been going on since last summer, when persistent delays by Serco, in transporting prisoners between jails and courts, led to an official improvement notice being issued.
It was alleged that instead of ending the delays, Serco staff simply fiddled the paperwork, for example by recording the time that the van arrived at court as if that meant prisoners were ready to appear in the dock.
The MoJ said in a statement that it had informed Serco of the new evidence and it was putting the contract under administrative supervision with immediate effect. Serco has agreed to repay all past profits made on the prisoner escorting and custodial services contract and to forgo any future profits.
Ministry sources said Serco has asserted that no member of the company's board had any knowledge of the alleged fraud on the prisoner transport contract.
The company has been put on a three-month notice that includes an overhaul of its management, strengthening of its internal audit procedures and opening up its accounts to much more intense government scrutiny.
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