Another fraud has been identified at Barnet Council – this time in a pension scheme run by outsourcing giant Capita.

The fraud involved “a number of lump-sum payments charged against the scheme”, according to a year-end report by external auditor BDO.

The money “has since been reimbursed and therefore has not impacted on the financial statements”, the report adds.

At a meeting of the local pension board on Tuesday (November 19), Leigh Lloyd-Thomas, engagement lead at BDO, said the fraud came from the council’s “outsourced provider”, which is Capita.

Mr Lloyd-Thomas said: “Somebody was able to access a number of old accounts and make payments from the fund. It was from your outsourced provider.

“That team did some work to make sure they isolated the full amount of money that had inappropriately left your account and they reimbursed that, so you were no worse off.

“The provider did sufficient work to say that they think they have got to the bottom of that and put that money back in your account.”

Mr Lloyd-Thomas said the amount of money involved in the fraud was “far from material”.

Nigel Keogh, the council’s interim pension manager, told the board what had been done to tighten up fraud defences in response to the incident.

Mr Keogh said: “With regards to the control weaknesses that gave rise to the fraud, the circumstances were in relation to user access.

“A full review was undertaken at the time the fraud was discovered. That type of user access has now been withdrawn.

“Capita have also reviewed the way in which user access rights are allocated.”

The incident comes shortly after a separate fraud case, which is currently under investigation, was brought to the attention of the audit committee on October 30.

Barnet Council was the victim of a £2 million fraud by former Capita employee Trishul Shah in 2016 and 2017.

In July last year, Mr Shah was jailed for five years after pleading guilty to two counts of fraud by abuse of position.

The council subsequently put in place a range of measures designed to shore up its defences against financial crime.