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Council Worker Jailed as Probe Reveals £1m Fraud

Tuesday 9th July, 2024

A Council Tax and Recovery Team Leader from Aberdeen City Council who'd worked at the Authority for 17 years has been jailed for 4 years after stealing over £1m from his employees. Michael Paterson, 59, exploited his position and weaknesses in processes to keep taking the money, starting back in 2006 until last year.

What started as a way to pay off debts, became a route to a lavish lifestyle beyond his means, spending the proceeds of his crimes on expensive holidays, eating out and technology. He was caught after a colleague raised suspicions about a transaction, prompting an investigation.

Rising through the ranks over the years, Paterson had unsupervised authority to issue council tax refunds of up to £3,000. He could also alter payee account details without authorisation or verification, which he did to transfer money to himself.

Paterson realised that he could benefit in situations where a householder had left a property and had not reclaimed for overpayment of their council tax.

The scam worked until a colleague noticed that a refund of more than £2,000 had been made on a computer system using Paterson’s username. She confronted him as she thought that the account was not due a refund. She reported her concerns to bosses who launched a probe into Paterson’s activities - and the scale of his crime emerged.

Police were called in, and he said: "I know I’ve done wrong. I regret what I’ve done". The final total taken was £1,087,444.47.

Paterson, who pleaded guilty - and whose salary was £35,000 a year - was still in debt at the time of his arrest.

Judge David Young KC pointed out that Paterson was able to perpetrate the crime because he was appointed to positions of trust by his employer, which he repeatedly breached over many years.

"This is unquestionably a serious matter and it must therefore bring serious consequences for you," he said.

"I am told you spent money on family and friends but also there was significant spending on yourself."

The judge told Paterson he would have faced a sentence of six years but for his early guilty plea.

The council’s financial controls and processes – including council tax refund arrangements – have been reviewed and strengthened.

Det Con Tom Cameron of Police Scotland said: “Paterson portrayed himself as an honest and professional individual and instead used his position to obtain a significant amount of money.


 

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