22 March 2002
The LSC, which began funding further education colleges and work-based training last April, is receiving an average of four complaints per month – most involving funding overclaims or falsification of student numbers.
The council has already established a special investigation unit at its headquarters in Coventry which is currently handling 33 cases of alleged fraud and financial irregularities. By the end of March, individual investigators will also be in place at each of the 47 local LSCs.
Geoff Snell, head of the unit, announced on March 15 that the LSC is in the process of recouping £500,000 from earlier investigations. He added that 70% of current cases involve colleges, while 30% involve other training providers.
Just over half (51%) of the cases under investigation concern funding overclaims, 24% falsifying student numbers and 10% breaches of financial regulations.
'These alleged frauds and irregularities involve significant amounts of money,' said Snell. 'Several millions of pounds is at risk in the 33 cases we are investigating at the moment, although it is impossible to give any firm figure at this stage.'
The LSC figures come in the wake of the government's decision to wind up its Individual Learning Accounts scheme because of alleged fraud. Almost half of the cases investigated by the LSC are reported by whistle-blowers working for providers.
The council, which has an annual budget of £7.3bn, is running a series of seminars for colleges and other providers. 'It is extremely important that we work closely with providers so that they are aware of the issues, are able to spot potential breaches and act quickly to nip them in the bud,' added Snell.
PFmar2002
