A4e accused in fraud scandal

A4e, the workfare company, stands accused of being involved in a vast fraud scandal.

The allegations came a week after the Department for Work and Pensions cleared A4e of fraud in its current contracts. A4e denies any wrongdoing.

Eddie Hutchinson, the former head of audit at A4e said that the leaders of the company oversaw a “disgraceful misuse of government and taxpayer funding”. His claims include:

• A bonus scheme for employers “drove inappropriate behaviour” by staff willing to commit fraud.

• Staff acted in the belief that if their irregularity was discovered, they could resign in the knowledge no further action would be taken.

• Two years on from a 2009 audit report warning that fraud was not confined to one part of the company, fraud was still “systemic”

A4e is entirely funded by government work and makes about £215 million a year from 72 government contracts.

A4e founder Emma Harrison paid herself an £8.6 million dividend last year. Harrison still owns 87 percent of the company and has a net worth estimated at more than £70 million.