Forensic financial analysis software used to combat fraud

This is a guest blogpost by Ian Watson, CEO of Altia-ABM. It reflects his experience and judgement.

Specialist financial analysis software is now a crucial tool in the investigation and prosecution of crime. It not only increases the speed of criminal investigations but also enables prosecutions in circumstances where they would have been very difficult and time consuming previously.

The following two significant cases of fraud highlight where prosecutions have been made possible due to the fact that the use of specialist software can aggregate huge volumes of paper-based and electronic data into a standard format and demonstrate links between separate items of evidence in complex cases.

Housing fraud in Southwark

The first case involves a homelessness case officer, employed by Southwark Council, who was found to have committed serial housing fraud over a period of three years. Ibrahim Bundu, a Southwark Council housing officer, fraudulently obtained council property for his mother, his ex-wife, his estranged wife and her aunt, and others who paid him in cash, totalling 23 properties allotted to people who should never have received them, some of whom were legally entitled to be in the UK.

Southwark Council, HMRC and the UK Borders Agency worked in partnership to establish the circumstances of the fraud.

Bundu had created reams of bogus documents including fake identification papers, references and forged medical certificates claiming that some of the applicants were pregnant and therefore should be considered a priority for accommodation.

The investigating officers used specialist software to bring together all of Bundu’s case notes and supporting documents over a three-year period. All of this documentation was combined with information held by HMRC and the UK Borders Agency and from this vast volume of data, investigators and prosecutors were able to pinpoint key evidence which demonstrated Bundu’s involvement in each suspicious case and ultimately led to his conviction.

The software was also used to establish the immigration status of individuals he had assisted, to enable UK Borders Agency to take action against individuals who were in the country illegally.

Investigators from all three agencies reported that they would not have been able to construct a viable case against Ibrahim Bundu without the ability to use technology to compile this amount of data into a format where investigators could begin their forensic analysis that demonstrated his guilt.

Southwark has one of the longest council house waiting lists in the UK and, it could be said, this fraud meant that people in genuine need were pushed further down the queue.

He was sentenced to four years in prison, later increased to six years after he failed to make reasonable efforts to pay back the £100,000 for which he was personally liable.

NHS fraud

The second case was a brazen £3.5m fraud siphoning money from NHS funds over a seven-year period before the perpetrators were brought to justice.

Neil Wood was a senior manager at Leeds and York Partnership NHS Trust and also worked with Leeds Community Healthcare Trust before moving to NHS England. Wood was responsible for the awarding of training contracts for NHS staff in all three roles. He awarded the vast majority of these contracts to an external training company, which in turn paid £1.8m to LW Learning Ltd, a company registered in the name of Lisa Wood – Neil Wood’s wife – for services, some of which were never delivered. While at NHS England, Wood awarded a training contract worth £231,495 to a company in Canada called Multi-Health Systems, which was run by Terry Dixon. Dixon was a contact of Neil Wood. He kept £18,000 of the money and transferred the rest back to LW Learning Ltd.

The investigation was conducted jointly by Police North East, HMRC and NHS Protect. Seven years of financial data had to be compiled into a format whereby investigators from the three organisations could identify the relevant financial transfers between the many bank accounts used in the UK and Canada and follow the money trail to show, beyond doubt, that these individuals had knowingly and intentionally committed the fraud.

Neil Wood and Terry Dixon were sentenced to a total of five years and eight months in prison, for fraud, abuse of position and money laundering. Lisa Wood was given a suspended sentence for money laundering.

Investigative teams from NHS Protect, HMRC and police forces nationally and internationally are increasingly relying on investigation software as a key weapon in their fight against crime.

My own company Altia-ABM has, I would say, been at the forefront of developing software to enable investigators to achieve more in a shorter time and to assist in the development of cases against criminals.

Our technology automates much of the data mapping and cross-reference process, allowing trained and experienced investigative staff to home in on the key transactions that prove wrongdoing. It has been estimated that complex investigations take more than 10 times the man-hours to complete if the data was cross-referenced manually. In addition, our  software also generates documentation which is accurate enough to stand up in court and withstand close scrutiny.

Update: This article was amended on 11 November 2020 to remove references to a co-defendant in the Neil Wood case who has since been acquitted of all charges.