Exclusive: Ministry of Defence fends off fake invoices in battle against fraudsters
The Ministry of Defence has dismissed more than a thousand invoices in each of the last three years in a warning sign that fraudsters are targeting government services.
A Freedom of Information request has unveiled the extent of invoices given the red flag by the government and their total value.
These can include claims for grants plus other goods and services provided for armed forces, with the Ministry of Defence coming under scrutiny for its handling of financial crime and fraud in recent years.
In the financial year ending March 2023, the total value of rejected invoices surged to nearly £211bn due to a single rejected invoice for £210bn.
In the two subsequent years, the total value of rejected invoices hit over £300m, with the last financial year reaching just short of £360m.
The Ministry of Defence said the most common reasons for rejections were incorrect quantities and amounts used by suppliers compared to purchase order agreements, duplication in invoice numbers and invalid tax details.
Defence against fraud
In April, former corporal Aaron Stelmach-Purdie, who served in Northern Ireland and Afghanistan, was sentenced to three years and four months in prison for fraud and money laundering after stealing nearly £1m from the Ministry of Defence for submitting fraudulent expenses.
A separate case involved 39-year-old army sergeant Andrew Oakes stealing £336,000 from the Ministry of Defence to buy Teslas.
PoliticsHome reported last year that defence fraud had cost the government almost £1bn between 2010 and 2024, with procurement fraud accounting for most of the cost.
Defence secretary John Healey has taken steps to fix procurement as part of the government’s drive to invest in capital across the defence sector over the next few years.
The procurement times will be radically shortened under new plans while Healey has changed structures to allow for “consistent accountability” in its processes.
A Ministry of Defence spokesperson said: “We follow strict rules to ensure invoices are being paid correctly and taxpayers’ money is used properly. As such, a significant proportion of invoices flagged as incorrect are resolved internally.”
Jason Kurtz, chief executive at software company Basware, said the new figures provide insight into the challenge the Ministry of Defence has in combating crime as he called for AI systems to ease the burden on officials.
“For hard-pressed finance teams, blocking fraudulent payments is only one half of the challenge,” Kurtz said.
“The massive workload associated with investigating and rejecting incomplete or fake invoices is a huge drain on resources.
Napier AI’s chief data scientist said the UK government was naturally a “top target” given the big number of transactions with suppliers it has to manage each day.