THERE has been renewed focus on the discredited Thurock-Council based National Investigation Service (NATIS) which has become the epicentre of criticism and condemnation.

A Freedom of Information request, which was challenged by Thurrock Council, has confirmed that the service, run from within the authority but which has now been disbanded by the Government, didn't actually have the legal power to carry out investigations.

The report also shows the council was unable to collect monies it was owed from other councils – while a leading Essex councillor has demanded the resignations of all involved in Thurrock Council's disbanded fraud team after he was wrongly targeted over bribery allegations.

Natis was set up in Thurrock Council in 2018 before being handed a Government contract to investigate fraud in the multibillion-pound Covid-19 government finance programme being administered by councils.

Natis operated within Thurrock Council but the 'wasteful and inefficient service' has now been disbanded by the Government and fraud investigations moved to the Insolvency Service.

The Times went to litigation to force Thurrock Council to release report.

Accountancy firm Mazers was commissioned by Thurrock Council to carry out an independent investigation into Natis and the report has now been released following a freedom of information request by the Times newspaper, that went to litigation as the council did not wish the information released, concluded that only three of Natis's 108 investigators had been granted these investigation powers.

The report, originally published internally in March 2024, found Natis operated with "limited governance" which "put Thurrock Council and taxpayers at risk" at a time when the council was heading towards virtual bankruptcy over disastrous solar power investments.

Natis was being run "inappropriately independent of Thurrock Council", the report reveals.

The report included examples of Natis appearing to present itself as separate from Thurrock Council, including official forms bearing a police email address and a job description calling Natis an "HM Government function".

The report reveals "most if not all" Thurrock Council staff seconded to work for Natis had not received proper training and had expired contracts which are required under the Proceeds of Crime Act 2002.

The report warned that if officers had been "exercising powers with expired secondments, their actions could be legally challenged". It said: "Any evidence collected, being information illicitly obtained, may be deemed invalid or unlawful, and have to be returned, possibly derailing investigations."

The council says it has taken legal advice and is confident any prosecutions remain safe.

Cllr Val Morris-Cook

Cllr Valerie Morris Cook, the portfolio holder responsible for resources, said: "We do not accept that all of the findings of the report are correct, but we have previously brought the main findings to cabinet with an action plan that we used to improve the service.

"The service has been transformed since October 2023 and has continued since then to successfully investigate and prosecute criminals who have targeted the public purse."

Despite Cllr Morris-Cook's assertion that the service has been transformed and was successful, it has revealed that since its inception NATIS has cost the taxpayer approximately £38.5 million. In that time NATIS only secured 14 convictions with the overall amount recovered by the service remaining 'unclear'.

In the wake of the report's release, Thurrock Council Reform Group Leader Cllr Alex Anderson said: "Once again Thurrock Council hit national headlines for all the wrong reasons.

"This episode raises an awful lot of questions for the Council and Thurrock Reform will make sure they're asked."

The Times is also critical of much of the decsion-making associated with NATIS, saying: "The decision to place such an important anti-fraud unit in that local authority is surprising, given that Thurrock was effectively bankrupt in December 2022 as a result of the shambolic mismanagement of the council's investment portfolio."

Formation of Natis

THE Natis counter fraud team was formed off the back of three south Essex councils uniting in a bid to tackle financial mismanagement.

In 2016, Thurrock, Castle Point, and Southend Council, came together with South Essex Homes, and formed the Counter Fraud Investigation Department (CFID).

The service was allowed the authorities to work collaboratively to prevent fraud, with investigators monitoring each other's councils.

It also provided a service to outside bodies to boost income for Southend and Thurrock Councils.

However, Thurrock Council left the partnership in 2018 and formed the National Investigation Service.

The Southend service was renamed the Counter Fraud Investigation Team and continued to work independently.

The CFID was overseen by a board of directors from the four organisations. The members included Joe Chesterton, the strategic director (finance and resources) at Southend Council, Sean Clark the now disgraced former finance chief of Thurrock Council, Mike Gatrell, the chief executive of South Essex Homes, and David Kleinberg, assistant director / head of counter fraud and Investigation at Thurrock Council.

Abuse of authority by NATIS

IN May 2024 another investigation by journalists exposed major concerns about how NATIS conducted its business.

Sometime around 2018/19 the service began using the email domain "police.uk" without the correct authority. It was roundly criticised for 'pretending to be police'.

Earlier, n 2017, Thurrock Council was criticised by the Court of Appeal after unlawfully bringing a prosecution against three lawyers for allegedly defrauding the Legal Aid Authority (LAA). Thurrock bypassed the Crown Prosecution Service and entered into a contract with the LAA to act on their behalf. The court ruled Thurrock Council did not have the authority to bring prosecution proceedings on behalf of the LAA. Thurrock Council admitted that its interest at the time was commercial.

Southend Council debt

THE Mazars report also showed Southend Council owed Natis more than £500,000 but was only required to pay back £272,000.

The £546,651 debt was owed to Thurrock Council for work it had done under the Counter Fraud Investigation Department (CFID) partnership which was disbanded in 2019.

In January, a Freedom of Information request to Thurrock Council showed that they had received £272,462 from Southend Council as a full and final settlement.

Southend Council later denied the payment and it is not included in forecast budget deficit documents for 202425.

Southend Council explained the issue on Friday. A spokesperson said: "The sum of £272,462.40 was paid by Southend Council to Thurrock Council in January 2025 following receipt of an invoice from Thurrock but was funded by money set-aside in 2018/19 when their service was in place, but no payment was made.

"Therefore there is no impact on the 2024/25 overspend position, and the utilisation of this previously set-aside money will form part of 2024/25 year-end financial position that is presented to Cabinet and committees."

Call for resignations

A FORMER Southend Council leader has demanded the resignations of all involved in Thurrock Council's disbanded fraud team after he was wrongly targeted over bribery allegations.

In 2022 Thurrock Council was forced to apologise to former Tory leader Tony Cox after launching an investigation four years prior.

The Council started to investigate Mr Cox in 2019 via the now disbanded Natis team over false claims by a whistleblower that he had taken a £1,050 bribe.

It was alleged he had taken the money to prevent Uber operating in Southend, however the money was used to pay for his wife's legal fees relating to a personal matter.

The case was dropped by the Crown Prosecution Service in 2019 after the allegation was found implausible.

Mr Cox sued Natis for unlawful detention by Natis officers, who did not say they were Thurrock Council staff.

The officers visited Mr Cox's house and warned him he could be arrested if he did not attend an interview with them. He was then ordered to drive to a custody suite in Barking while a Natis officer went with him.

Mr Cox later settled out of court and accepted an apology.

Mr Cox, now leader of the Reform Group, said: "Even to this day I have snidey comments from someone calling me "taxi Tony". It had a huge strain on me and my family.

"I tried to warn people this department was making people's lives a misery. We should never have gone into a counter-fraud arrangement on the basis of trying to make money.

"They showed what appeared to be a warrant card. They even quoted me a code that police officers use when they undertake arrests. This was all in front of my children.

"They thought they could go for politicians because they were completely out of control and what scares me is how many people have been caught up by that team."