PRESS RELEASE
26 February 2009
PR/07/08/09
HEALTH SERVICE FRAUD WAS PREVENTABLE
A major health service fraud, committed by the Brangam and Bagnall firm of solicitors, could have been prevented had the most basic of financial monitoring been carried out. That’s the message from a report, published today, by the Public Accounts Committee.
Commenting on the report, Mr Paul Maskey MLA, Chair of the Public Accounts Committee said, “From our investigations, it was evident that the Health Bodies had dispensed with even the most basic of payment checks because they were working with a professional, a professional who had previously been one of their colleagues.”
The Committee found that since Mr Brangam had previously been a senior manager in the Central Services Agency (CSA), he had inside knowledge of the strengths and weaknesses of the controls system, which enabled him to target his frauds with maximum precision and minimum risk of detection.
Mr Maskey continued, “The Committee was appalled at how Mr Brangam’s departure from CSA had been handled. For the six-month period between expressing his intention to leave and actually leaving, Mr Brangam was the Director of Legal Services which was carrying out a market testing of legal services, while simultaneously establishing his own practice to provide those services to the health sector.”
“To make matters worse, when the fraud was identified, the Committee was not satisfied that the Department’s investigative work was sufficiently timely, wide-ranging or penetrative.”
The Committee was also disappointed to learn that, despite two complaints being made against Mr Brangam and his practice, the Law Society’s regular inspections of BB & Co identified no problems other than a minor issue in 2001.
Mr Maskey concluded, “This is one of the worst examples of procurement practice that this Committee has ever seen. There were clear conflicts of interest from the outset, fundamental checks in the payment process were dispensed with and the select list for legal services remained in place for 12 years, preventing other firms from entering the market. Clearly such poor practice left the public service more vulnerable to abuse by unscrupulous individuals than it should have been. We can only hope that lessons will be learned from this debacle and that such poor practice will not come before this Committee again.”
ENDS
Notes to Editors
- George Brangam, solicitor, was the owner of the legal practice of Brangam, Bagnall & Co, who fraudulently extracted at least £278,000 from the Health Service over a seven year period. The Department of Health, Social Services & Public Safety (the Department) has subsequently taken legal action and recovered this sum in full.
- Standing Orders under Section 60(3) of the Northern Ireland Act 1998 have provided for the establishment of the Public Accounts Committee (the Committee). The main statutory function of the Committee is to consider accounts and the reports by the Comptroller and Auditor General for Northern Ireland (C&AG) laid before the Northern Ireland Assembly.
- The C&AG is head of the Northern Ireland Audit Office (NIAO) and is empowered to investigate any area of expenditure and has a statutory right of access to all files and papers in Departments and public bodies.
The PAC Committee members are:-
Alliance |
Mr Trevor Lunn |
Democratic Unionist Party |
Mr Jim Shannon 6 |
Mr Jonathan Craig |
|
Mr George Robinson 7 |
|
Mr Jim Wells 3,4,5 |
|
Sinn Fein |
Mr Paul Maskey (Chairperson) 2 |
Mr Mitchel McLaughlin |
|
Social Democratic and Labour Party |
Mr John Dallat Mr Thomas Burns 1 |
Ulster Unionist Party |
Mr Roy Beggs (Deputy Chairperson) |
Progressive Unionist Party |
Ms Dawn Purvis |
1 With effect from 04 March 2008 Mr Thomas Burns replaced Mr Patsy McGlone.
2 With effect from 20 May 2008 Mr Paul Maskey replaced Mr John O'Dowd.
3 With effect from 1 October 2007 Mr Mickey Brady replaced Mr Willie Clarke.
4 With effect from 21 January 2008 Mr Ian McCrea replaced Mr Mickey Brady.
5 With effect from Tuesday 27 May 08 Mr Jim Wells replaced Mr Ian McCrea.
6 With effect from Monday, 15 September 08 Mr Shannon replaced Mr David Hilditch.
7 With effect from Monday, 15 September 08 Mr Robinson replaced Mr Simon Hamilton
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