NHS Fraud Squad: Catching the crooks stealing £1.3 billion from the system

Every year, close to £1.3 billion is defrauded from the NHS. It is a shocking attack on an organisation that needs every penny for patient care. What may surprise those who don’t know about the scale of fraud against the health service is how much of that money is stolen by insiders.

Individual doctors, dentists, opticians, members of hospital senior management and administrative staff have all been found guilty of substantial frauds, swindling hundreds of thousands of pounds out of the NHS.

In one case, investigated by Scotland’s NHS counter fraud service, a hospital worker stole surgical equipment worth £1.3 million, which was spent on lavish holidays.

But these crimes don’t go unchecked.

I myself have worked as an NHS fraud investigator for ten years. My organisation, the NHS Counter Fraud Authority, is the subject of five-part BBC documentary Fraud Squad NHS, being shown every day this week.

The NHS Counter Fraud Authority is responsible for gathering intelligence on fraud, bribery and corruption, and, wherever possible, preventing these crimes before they happen. Before joining the NHS, I was an investigator at the Department for Work and Pensions for 15 years. I dealt with everything from individuals claiming extra benefit money for themselves, to organised gangs defrauding the system with forged cheques and hundreds of fake identities.

At the NHS, the amount of money stolen can be just as significant, whether opportunists inside the organisation are behind it, criminals on the outside, or a toxic combination of the two. For the lowest paid, desperation can play a part, but highly paid professionals usually have no real reason to steal other than greed.

Over the years, the NHS Counter Fraud Authority has dealt with, for instance, the case of the dentist who wasn’t really a dentist. She had failed her exams overseas then purchased fake degree papers. To prosecute, we flew in witnesses who could testify she had lied.

Then there was the senior manager who tricked her hospital into paying for animal sperm for her private business, a stud farm, by disguising them as legitimate payments for NHS items including a “titanium skull plate”.

It is still surprising to see how senior staff members put their careers in jeopardy for relatively small amounts of money. Recently, one chief executive of a trust was prosecuted for stealing £11,000 by awarding a contract to her husband and trying to cover up that the work wasn’t delivered. She lost her job and was convicted of criminal offences.

Most of our cases come to us via tip-offs to our reporting lines from staff members (the majority being very honest and hardworking), or the public. A patient might let us know that they have received an NHS bill from a dentist who has already charged them for the work privately. We see a number of cases involving dentists, such as one who stole more than £1 million by charging for work she hadn’t conducted and making claims for people who were dead or didn’t exist.

My most significant case to date was the investigation of a group of perfusionists, specialists who operate heart-lung machines during certain types of surgery. The group was employed full time at Basildon University Hospital, but during their paid NHS hours, its members were working off-site on private contracts at other hospitals. They billed the service for 14,000 hours of work that they didn’t conduct, cheating it out of more than £1 million pounds.

When the case landed on my desk, I didn’t expect a conspiracy of this scale. I could imagine one or two people being involved – but this was a large part of the team, led by the manager, John Mulholland. He was a well paid, world-renowned perfusionist, hired to set up the unit and decide what staff and resources it needed.

As the case built, staff members gradually revealed how fearful they were of Mulholland, who some believed had the power to make or break their careers in the UK and beyond. He was a controlling person, but he could also be quite charming. Under his peer pressure, these intelligent perfusionists acted illegally. Had they been in another hospital, I don’t know if they would have turned to crime.

We trawled through car park records and building swipe card data to see who was in the hospital when they were meant to be. We discovered Mulholland and three other members of staff were running a private company called London Perfusion Science, which employed Basildon staff to work at two other NHS hospitals on top of their full-time salaries.

In some instances, staff would be on call at multiple hospitals at once. In others, they would lie about where they had been working.

We brought in Essex Police and raided Mulholland’s home, where we found a wealth of incriminating information: spreadsheets listing which hospital each member of staff was at every day; an email that said: “We’re the villains, aren’t we?”

The result of our investigation was the return of £577,000 to the NHS and four technicians – Mulholland, Ann Clements, Tom Cumberland and Martin Oliver – being jailed for a total of nine years.

In a recent case I worked on, a fraudster was caught out when he went on holiday. Andrew Taylor was a locksmith at Guy’s Hospital, London, who cheated the NHS out of £600,000, which he used to fund private school fees and a car worth £27,000.

Taylor seemed to act largely with impunity as the hospital’s sole locksmith from 2006, ordering new keys, padlocks, key chains and fobs without sufficient oversight. He was the first to work, last to leave each day.

But when he was away on holiday, an urgent order came through, which led his colleagues to look up the main supplier that Taylor used: Surety Security. There was no answer from the number listed for the company and then, with a bit of digging, we discovered Taylor had once been listed as a director of the company.

My team was brought in to look through Taylor’s company’s invoices, and found that he had marked up the price the hospital paid for supplies by up to 1,600 per cent, on hundreds of occasions. He bought toilet locks for £11.82, but created invoices to charge the hospital £78. Thousands of key blanks that cost him 17p each from a wholesale provider were billed at £1.70.

As soon as Taylor returned from his holiday and discovered that he was being investigated, he resigned and shut down Surety Security. In court, he tried to justify his mark-ups, saying had enhanced each product to make it more secure. These included a 1,000 per cent mark up on a key chain. The judge didn’t believe his defence, and last year he was sentenced to six years in prison in March.

It amazes me how people can be so greedy and steal from an organisation that is designed to save lives. That said, it is always satisfying to see them prosecuted for taking money from the NHS health system, which belongs to you and me.

As told to Cara McGoogan 

Fraud Squad NHS is on BBC One every day this week, at 9.15am