CALLS for a fraud investigation at Ealing, Hammersmith and West London College over an alleged £4.1m shortcoming in its finances are being challenged by the college.

A report leaked to the Evening Standard said senior figures failed to anticipate the deficit or realise the wage bill was under-estimated by more than £1m.

The draft report, by accountants Grant Thornton, warned that data might have been falsified and a secret bank account created.

The college later responded to the story in the Standard with the following statement: “The story refers to a leaked document which is a draft internal audit report (by Grant Thornton) from last summer but not the final audit report, which was completed in September 2013.

“That final report, to which the Standard did not refer, in fact highlighted the auditors 'had not identified any conclusive evidence of fraud'.

"Furthermore, the piece did not state that the financial statements to the year ending July 31, 2013 had been audited by the external auditors, Baker Tilly, in accordance with the college's legal requirements to do so.

"Led by interim principal Dr Elaine McMahon, the college is working on a viable financial action plan and continues to have constructive discussions with the Skills Funding Agency."

The college, which has more than 25,000 students and operates across four sites, is in the process of cutting its wage bill by £5m, putting 85 staff at risk of redundancy.