Dunedin Citifleece report confirms gobsmacking laxity

The Deloitte report on the vehicle 9and other) fraud at Dunedin City Council confirms a gobsmacking laxity in the council financial systems and staffing oversight.

$1.5 million of taxpayers money stolen. Perhaps significantly more – they say it’s too hard to check the full extent.

Questions have been asked for years about questionable practices, and they were fobbed off. The council was beyond reproach.

It is hard to get a resource consent from the council. They have a well known reputation for stifling business development, and proposals to rezone land struggle against intransigent bureaucrats. Talk of fiefdoms and agendas within the council are common.

But when it came to systems and oversight within the council was unforgivably lax.

The blame is all being aimed at one person, the ‘Citifleet Team Leader” (perhaps that should be Citifleece) Brent Bachop, who died suddenly just days after being confronted. No suspicious circumstances regarding his death, many suspicious circumstances regarding his dealings within the DCC.

DCCDeloiite1Well over a hundred vehicles still on the Council asset register had been sold over the previous ten years. Too a variety of people who knew they were getting a bargain, and many of home paid cash or check directly to Bachop or paid into his own bank account.

This fraud didn’t happen without a willing market, at the very least.

DCCDeloitte2A number of gobsmacking control failings allowed Bachop to get away with this. And that’s just the vehicles. Able to sell over a hundred vehicles (the ‘high risk’ number was 152) without anyone else noticing anything wrong with the asset register. Over a ten year period.

And that wasn’t all.

Use of an unrestricted fuel card to purchase personal items including soft drinks, packets of chips, milk, chocolate biscuits,  bread and petrol for personal use – $102,908.

He bought a trail bike for $7,333.33 with council money that never appeared on the asset register and was never registered as owned by the council.

Cash withdrawals for topping up car park pay stations – $104,800 unaccounted for.

An un-named person was given a parking ticket in 2007 using a Council vehicle. Reported and no known follow up. Staff regularly observed person in Council vehicles during Council work hours. Person had use of Council car for the six months up until discovery of the fraud in May, and petrol and $3020 of repairs were paid by council in that period.

The openness of some of the abuses are as gobsmacking as the lack of systems, oversight or checking the many ‘red flags’.

As a Dunedin ratepayer throughout this period I’m appalled.

A number of changes have taken place and we have been assured that nothing like this will happen again. But no one has yet been held to account.

A dead man looks like being responsible in a big way. But he was allowed to get away with it by many others.

DCC: Deloitte Report Released

Redacted report: www.dunedin.govt.nz/deloittereport

Radio NZ:

ODT: $1.5m fraud: ‘Red flags were ignored’

ODT: Fraud: Weak council culture cited

ODT: Bachop at ‘centre of’ other issues

ODT editorial: DCC fraud: a salutary lesson

ODT Councillors waffle: Findings disappoint most councillors

What if? Dunedin: Vandervis: Deloitte and Police Citifleet investigations

Received from (councillor) Lee Vandervis
Fri, 19 Dec 2014 at 11:54 a.m.

Deloitte and Police Citifleet Investigations – information I believe should be public in the public interest.

What if? Dunedin: DCC: Deloitte report released on Citifleet #whitewash

I knew Brent personally and was shattered when he [died]. Whilst I am disappointed he was clearly guilty I cannot believe he was the only person involved. His death seems to be the opportunity for Council to draw a line under this matter and move on. One wonders what would have happened had Brent been held to account in a court of law. It is hard to believe that a few Council employees and purchasers of these vehicles would not have gone down with him. From what I am reading the whole fraud was committed by Brent and basically no-one else knew a thing about it. Even the most naïve of us knows that cannot be true. It is clear that if you were in the know and wanted a cheap car, Brent was the man to talk to. In conclusion, spare a thought for Brent’s family, his wife, his children, his parents. For them this nightmare goes on, they have lost Brent and yet the pain, grief and search for answers to why continues.

Radio NZ: Council under fire after fraud report

Dunedin Mayor Dave Cull said the only employee involved in the fraud was Mr Bachop.

“Deloitte have concluded that there was no other staff member that benefited financially from the fraud,” he said.

“There were control failures and responsibilities but it was clear there was only one perpetrator in the council.”

Deloiittes didn’t establish that at all.

Deloitte also found severe failings at the city council over the 11-year period, saying a number of aspects of the council’s culture allowed long-term fraud.

It said the processes for accounting for and monitoring fixed assets were severely deficient and there was little oversight of Mr Bachop.

Mr Cull admitted there were serious failings.

“Deloitte’s review has identified control failures – lamentable ones, appalling ones – and anything that was detected, anything any of those control failures that were identified are either being dealt with or have been dealt with now.”

Dunedin City Councillor Lee Vandervis said he tried to blow the whistle on the scam years ago.

“Most of the issues in the Deloitte report had been known about for many years. Certainly as far back as 2011 and nothing was done about it.”

Leave a comment

4 Comments

  1. Brown

     /  20th December 2014

    Local govt is small time compared to central govt. Your problem is that you think people who can take money from you at the point of a gun care about spending it carefully when more is always available.

    Reply
  2. Initially I thought the guy had a gambling problem, but I read something recently, that indicated there may have been gang involvement in the theft of the vehicles.

    Reply
    • Under “What did Mr Bachop do with the proceeds?” the report says:

      1.36 We have not completed a detailed tracing process. However it is clear the $349,000 deposited into Mr Bachop’s bank account has been mainly spent on a high volume of low dollar value transactions….

      …and the rest of the paragraph is redacted. And…

      1.38 It is not possible to ascertain what Mr Bachop did with the proceeds he received in cash…

      …followed by more heavy redaction.

      Reply
      • That report must resemble a Top Secret FBI cover-up document with all the black outs and redactions. It sounds like they know a lot more than they are letting on.

        Reply

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