Paul Dolan, CEO of Accent Housing sits on the eastern regional panel of the National Housing Federation.(NHF).
The NHF produce a code of governance that all members have to follow including guidance on conduct and integrity.
Paul Dolan had been made aware in 2021 of the overcharging by ESH
The NHF produce the schedule of rates on which charges for all repair work is based
The NHF produce a 72 page document on fraud;
Chapter 7. Responding to fraud
Step 1 Managing referrals
No matter what type of fraud or how it is received, all incidents should be reported and logged with the appropriate staff members.
Step 2 Immediate actions
Notification should be made to the director responsible for the area of suspected fraud the head of risk and assurance the director of finance and resources (David Royston).Every investigation of suspected fraud should result in a written report.
It would be beneficial to note how the fraud was detected and whether or not existing controls were effective.
Step 7 reporting; list of risks
Contractors (bogus/inflated invoices, work not conducted to specification).
Chapter 8 Roles and responsibilities
Setting the 'tone from the top' is a way that your organisation can send a powerful message across the organisation internally and to its tenants.
The role of the board
A well communicated message or statement of intent from the board can assist in promoting the stance that all staff should seek to tackle fraud when they see it.
All types of fraud should be considered as a potential entry on your risk register.
The role of tenants
Remember, your tenants are also in your fraud team.
Most fraud referrals arise from a tip off, and having your tenants be more aware of fraud will enable you to be more reactive to issues as they happen.
“Knowingly” typically is defined as:
- Actual knowledge of falsity
- Deliberate ignorance of truth or falsity (“willful blindness”)
- Reckless disregard of truth or falsity
Fraud; In each case:
- the defendant's conduct must be dishonest;
- the intention must be to make a gain; or cause a loss or the risk of a loss to another.
The tribunal concluded that ESH Construction had committed:
'a regular and sustained practice, whether or not deliberate, of overcharging'
The tribunal has no jurisdiction to make any determinations outside of whether charges are deemed to be 'reasonable' and whether the standard of work is 'reasonable'.
ARHM code of practice 8.1
'Organisations should have adequate control systems in place to ensure that works have been completed to an acceptable standard, prior to payment of invoices.'
RICS code of practice
9.1 Contractors should issue appropriately detailed invoices for all works carried out, however minor, which clearly state what the charges are for......You should have control systems in place to ensure that work has been completed to an acceptable standard prior to authorising payment of any invoice.
1.6 In incurring costs in the provision of services, the landlord and managing agent are spending other people's money and must demonstrate competence, objectivity and transparency in dealing with client money and service charge monies
10.2; it is an offence to commit fraud by false representation.
42 invoices were challenged: not one was genuine. Not a single invoice undercharged residents.
Tribunal decision:
it was 'inexplicable' why invoices from ESH were never checked by anyone at Accent housing.
The reasons are quite simple. No one cared.
- The existing legislation and regulation of leasehold is inadequate.
- There is no deterrent to bad practice.
- The management of leasehold is understaffed.
- The relevant codes of conduct and governance provide no protection as they are ignored.
- Staff lack integrity and diligence.
- The reputation of the organisation is always placed first.
- As repair charges are simply passed onto leaseholders at no cost to Accent there is no reason for any checks to be in place.
DUTY OF CARE
Each individual employed by Accent Housing has a duty of care to protect residents including their financial welfare.