National Fraud Initiative – preparing for the future

North West Auditors Forum 2014Kevin Boon

NFI – preparing for the future

• Pre 2014 - NFI recap• Data/Match Quality• Smarter Working• What’s new in NFI 2014/15• NFI and the Future

– Other purposes– Fraud– Flexible matching– Application checker

Pre 2014 - NFI recap

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NFI: Key Facts

Sophisticated batch data matching

exercise designed to prevent and detect

fraud

Established in 1996 and undertaken every 2 years

Incorporates England, Wales,

Scotland and Northern Ireland

Over 1,300 mandatory and

voluntary participants provide

8,000 datasets

In 2012-13 3.76m data matches

released (Recommended

Filter Matches 15%)

Over £1bn of fraud, error and

overpayments identified to date

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NFI Batch Data Matching: The Process

Participating bodies submit specified data

The NFI matches data

within and between bodies,

to identify anomalies

The data matches are

returns matches to participants

Participants investigate matches, to

establish fraud, error or other another cause

The NFI Team feeds back the

outcomes within the National

Report

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NFI Batch Data Matching: The Data Pot

Blue Badges Concessionary Travel Pass

Creditors Council Tax DWP & DDRI Deceased Persons

Deferred Pensions Electoral Roll

Fraud Data Housing Benefit Claimants

Housing Tenants Insurance Claimants

Market Traders Occupational Pensions

Payroll

Right To Buy Personal Alcohol Licences

Private Residential Care Homes

Student Loans Taxi Drivers UKBA Immigration Data

Waiting Lists

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The NFI Web Application

The NFI is delivered via a specially developed web application designed to place the user in control of their investigation

The Web Application Key Features

•Secure facility for submitting data and for distributing matches

•Hierarchal and controlled user access

•Case management control features

•Management information

•Online training programme

•Data quality assessment

NFI Cost Benefit per Organisation Type

Type of mandatory body Number of bodies (across UK)

2012/2013

fee

Average financial outcomes this

reporting period

London borough council 33 £4,150 £1,534,167

Metropolitan borough council 36 £4,000 £559,391

Unitary authority 76 £3,650 £489,781

County council and fire authority 62 £3,750 £376,443

District council 228 £2,100 - £2,300 £94,238

Police body 53 £1,000 £53,792

NHS organisation 441 £1,000 £15,598

Other local government bodies 65 £1,000 £4,639

Key Outcomes of the 2012/13 exercise - across England

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£203 million in fraud and error was detected

571 prosecutions

120 people employed without the right to work in the UK were identified and as a result were dismissed or asked to resign

86 properties recovered for social landlords

21,396 blue badges and 78,443 concessionary travel passes cancelled

Data Quality

Data Quality

Duplicate creditors

Data Quality is high priority (after Security)

Why is it so important?• Meeting specifications

• Poor data produces spurious matches

• Wasted time and effort

Garbage in, garbage out

Duplicate invoices

Data Quality

Duplicate creditors

How can you check Data Quality?Using Excel/IDEA

• Date sorting for completeness

• Numeric sorting and control totals for reasonableness

• Alpha sorting for completeness and rogue data/records

• Excel format checking

• Record count – truncation

• Gap detection for quality and completenessDuplicate invoices

Smarter Working

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• Data Quality

• Early engagement of investigators

• Timing of follow up e.g. students

• Key reports

• Recommended matches

• Using NFI as case management system

• Filtering and sorting matches

• Visual sifting using vertical view

• Multiple match opening/closing

• Larger reports e.g. Creditors– Exporting

– Filtering in Excel (guidance available)

– Summary recording of outcomes

Smarter working

What’s new for 2014/15?

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• Security Policy

• Move to SFIS

• PSN

• UPRNs

• Annual Council Tax SPD exercise

• Outcomes MI report separate Fraud and Error

• More match filters introduced

• Extending the vertical view quick tick function

• New Benefit ‘customer’ or ‘official’ error categories

• Improved search, navigation, export and shared comment facilities

• More efficient further information enquiry process for:-– Home Office immigration

– Pensions

– Students

What’s new in 2014/15?

Other Purposes and The Cabinet Office

NFI and the Future

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The Future: Other purposes

• The Serious Crime Act 2007 gave powers to the Secretary of State to extend the purposes of data matching beyond fraud.

• Data matching through the NFI could help public bodies to reduce the

significant levels of debt owed to them.

• Arrears matching could identify details of those with tenant arrears,

court fines, parking notices, child support payments and student loans.

• Locating absconders.

• The powers were never enacted.

•However, the future looks better…..

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The Future: The Cabinet office

• What the move to the Cabinet Office will mean for NFI:-

– Transfer of mandatory powers before March 2015

– Updated Code of Data Matching Practice

– Inherit existing powers

– Extend mandatory participants (including government departments)

– Legal power of Secretary of State to change purpose

– Extension to error, debt/arrears recovery, maladministration, crimes other than fraud

Fraud and The Cabinet Office

NFI and the Future

NFI Fraud Detection and Prevention

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We intend to… “deploy the National Fraud Initiative more widely as a near real-time tool to enable data matching between departments, and between central and local government”

We are developing services to also assist with fraud prevention

The NFI has traditionally focussed on fraud detection

The Flexible Matching Service(FMS)

NFI and the Future

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• The NFI flexible matching service is a powerful and sophisticated data matching engine that instantly identifies matches for counter-fraud investigation

• A new NFI web application has been built which includes a facility to create and manage data matching jobs and an interactive data submission wizard

• It can run batch data matching as stand-alone tasks at a time and frequency that suits your organisation’s operational requirements

• All existing NFI matching options are available to participants

What is Flexible Matching?

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What can The Flexible Matching Service be used for?

Internal/Project Data Matching

• Participants upload data for internal matching only

• The datasets are only be matched to each other

• Optional data matching against the NFI core datasets

Multi-Organisation Data Matching• Regional data matching initiatives where a group

of participants wish to submit data for local cross matching

• Optional data matching against the NFI core datasets

FMS: Existing Uses

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Personal budgets

Housing benefit to student loans

Council Tax to Electoral Register

Mortality Screening

The Application Checker

NFI and the Future

An Overview of the Application Checker

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• Our new service that we are about to launch

• Matches applications on a record by record basis with instant results

• Designed to help prevent fraud at the point of application

• Prevents fraud getting into your systems by data matching against the core

NFI data

Application Checker: Basic Principles

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Payroll, Housing Benefit, Fraud Data and Immigration Data Matches

Date of Birth

Address

Names

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Further Information

Further information regarding the NFI can be found on our website.

Alternatively please contact the NFI team via NFI queries

My contact detailsKevin Boon k-boon@audit-commission.gsi.gov.uk