Police Scotland are investigating 25 suspect Angus applications for Covid-19 small business support.
The authority has been stung by four payouts totalling more than £50,000 made to applicants who managed to slip through the net with dodgy claims for cash from the scheme set up to help struggling businesses through the coronavirus crisis.
Council chiefs have said eagle-eyed staff picked up almost 20 other apparently bogus claims, many of them spotted through the local knowledge of employees after alarm bells rang around the nature of the applications.
As the police investigation into the alleged frauds continues, Angus scrutiny and audit councillors were told officials do not expect the authority will suffer a financial hit as a result.
Within the first six weeks of the scheme, more than 1,000 Angus firms received vital aid to the tune of more than £11million.
Angus counter fraud team leader Ewan Ritchie told a remote meeting of the area’s scrutiny committee the council is working closely with police on the inquiry.
“There have been 25 suspicious applications referred to Police Scotland. Of those 25, 19 have not been paid.
“They were intercepted by our revenues officers. Two were paid, but were largely recovered by intervention by the banks.”
He added: “Four others have been what you would call successful transfers and we have paid out £52,500.
“It was realised too late that those were frauds and we were unable to reject the applications.”
Council finance director Ian Lorimer said: “The council is effectively an agent of the Scottish Government in the administration of the business grant scheme.
“The controls to be applied were probably less than we would ideally have but there were sound reasons for the timescales and the urgency of the situation. I don’t expect Angus Council to be impacted.”
Scrutiny and audit convener, Arbroath SNP councillor Alex King said: “I don’t want to go into too much detail because these remain current cases.
“I found the application process when I acted on behalf of two charitable trusts quite tedious at the start, but it then got very much easier.”
Detective Chief Superintendent Phil Chapman of Police Scotland said: “Police Scotland is well aware, and alive to fraudsters, who will try to exploit any situation.
“Sadly, during the current pandemic, this has been no different and we have seen attempts by fraudsters to adapt well-known techniques.
“We are working with the Scottish Government, local authorities and partners to investigate a number of potentially fraudulent small business grants applications and assess if these are criminal. However, we believe millions of pounds have already been prevented from being paid to fraudulent applicants.
“Officers are able to rely on the support of those in the public and private sectors to continue to reduce the risks with better technology, communications and preventative methods.
“We remain vigilant, working with our partners to alert and warn of possible fraudulent activity, not just those associated with COVID-19 and continue to relentlessly pursue fraudsters and make Scotland a hostile environment to operate these activities,” he added.
