If it’s Friday it must be (Lloyds TSB) Procurement Fraud Day

We featured back in June the case of the Lloyds TSB Finance Manager who was charged with defrauding the bank of a couple of million. The other day she pleaded guilty. Here’s Reuters:

Jessica Harper, who served as the state-backed bank's interim head of fraud and security for digital banking, faces a lengthy jail sentence after pleading guilty to fraud and money laundering at Southwark Crown Court in south London. Harper, 50, submitted false invoices to claim a total of 2,463,750 pounds between late 2007 and December last year, the court heard.

We don’t know the  full details of the invoices she created that formed the basis for the fraud – one assumes they were to “dummy” companies that she controlled, although conceivably there could have been other players involved. Given her guilty plea, that wasn’t revealed in court.

So, here are some questions to Lloyds. I don’t suppose they would respond to a Freedom of Information request, even though they’re part owned by the Government, but I wonder whether Mike Whitby might like to answer them – OK, one particular horse may have bolted, but it’s not too late to fit those locks…

  • Is it possible for invoices to get paid by Lloyds TSB without a supporting purchase order?
  • Do all purchase orders have to be counter-signed by someone other than the order-placer /  budget holder?
  • What checks are in place in terms of receipt of goods and services; how do you ensure that you’ve actually received what you’re paying the invoice against?
  • Do new suppliers have to be formally ”onboarded” in some way, with some approval process, before they can be paid?
  • Does onboarding include some verification that they are genuine firms e.g. with some trading history?
  • Is there a code of ethical behavior – applied to all budget holders, not just procurement people?
  • Do senior managers routinely sign up to the code, including making conflict of interest declarations?

All of us in the UK own a tiny bit of the bank, so it would be good to know they are looking after our money on the procurement side of the business at least!

Voices (2)

  1. Nick Bacon:

    Unfortunate set of tags here!
    A list of best practices will grow, always with the benefit of hindsight as different attempts to defraud are detected. Unfortunately as the controls get evr more sophisticated I suspect so too will the fraudsters methods.
    Imagine the scenario where ‘operational intelligence’ is flagging the next loop hole!

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