Government says it is independently auditing all business with the welfare-to-work firm after allegation of attempted fraud
The government has launched an investigation into an allegation of attempted fraud against the welfare-to-work company A4e.
The Department for Work and Pensions (DWP) said on Friday it had been made aware of an allegation of attempted fraud in relation to a mandatory work activity contract with the firm, which is already facing a police investigation in relation to previous allegations.
A statement said: "As a result of this new allegation DWP has immediately commenced its own independent audit of all our commercial relationships with A4e.
"We have required A4e to make available all documentation which our auditors may require and provide full access to interview any A4e employees. This is separate from the independent review of internal controls which A4e has previously announced.
"The chief executive of A4e was informed of this at a meeting with a senior DWP official earlier today.
"We have made it absolutely clear to A4e that we take this matter very seriously and that if, at any point during the audit or thereafter, we find evidence of systemic fraud in DWP's contracts with A4e we will not hesitate to immediately terminate our commercial relationship."
A4e said: "The board has made consistently clear in all previous statements that we take any allegations of fraudulent or otherwise illegal activity extremely seriously. There is absolutely no place for this type of misconduct at A4e.
"We obviously acknowledge the concerns raised by DWP, and we welcome and will co-operate fully with their planned investigations.
"A4e has more than 3,500 staff and operates out of 200 offices in the UK. From December 2005 to date nine cases relating to A4e have been referred to the Department of Work and Pensions to review claims submissions.
"Of these nine referrals, one, dating back to May 2008, resulted in the prosecution of an individual member of A4e staff, which was widely reported at the time.
"Another is the case now being handled by Thames Valley police. In each of the remaining, closed cases, the DWP's view was that these were not incidences of malpractice.
"The board has asked White & Case LLP to lead an independent and thorough review of A4e's controls and procedures. That process will be carried out concurrently, and all findings will be provided to DWP."