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Accountant Gambles Away £44m Of Council Money

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Staffordshire trainee accountant gambles away £44m of council money

Aug 5 2008

A trainee local authority accountant used more than £44 million of the council’s money to play the stockmarket, it has emerged.

Andrew Pate borrowed the money on behalf of Newcastle-under-Lyme council in Staffordshire - almost tripling its debt in the process.

The money was then invested through a stockbroker friend whose business he was trying to help.

His activities went undetected for more than seven months in 2004 until the alarm was raised.

Pate did not benefit personally from the investments but exposed the council to the risk it would lose the money.

The story came to light after he was struck off by his professional body.

CIPFA, the Chartered Institute of Public Finance and Accountancy found Pate, from Stoke-on-Trent, guilty of misconduct.

“On various dates in August and September 2004 on behalf of the council Mr Pate undertook transactions with a broker, X, which were not for a purpose relevant to the council’s function... but were undertaken by Mr Pate to assist X,” a disciplinary committee report said.

“The committee considered that there was a very considerable breach of trust and an extremely serious breach of the bye-laws.

“The committee emphasised that Mr Pate had caused the council to act unlawfully and that he did so knowing his responsibilities, which he deliberately disregarded.”

A spokesman for the council said Pate had been dismissed from his position and internal accounting controls improved.

He said: “Newcastle Borough Council has been informed by CIPFA of the disciplinary proceedings against Mr Pate.

“The basis for the proceedings occurred four years ago and the borough council has since reviewed its treasury management procedures and improved controls to reduce risk.

“Mr Pate, a qualified accountant, was subsequently dismissed from his position.

“CIPFA has acknowledged that the ‘low risk’ transactions authorised by Mr Pate were carried out at a time when the market was stable and that there was no risk to the council’s capital sums.

“We would not wish to make any further comments in addition to those already made by CIPFA.”

http://www.birminghampost.net/news/west-mi...65233-21473158/

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Staffordshire trainee accountant gambles away £44m of council money

<snip>

“CIPFA has acknowledged that the ‘low risk’ transactions authorised by Mr Pate were carried out at a time when the market was stable and that there was no risk to the council’s capital sums.

More incompetent reporting. Did he "gamble money away" or "gamble with"? Was there really "no risk" to the council's capital?

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Did he lose money or not? The article doesn't say either way.

The article headline says he lost the money (gambles away) which is clearly wrong.

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they dismissed him? If anything they should promote him, the government is clearly copying him with their throwing money at Northern Rock.

=========================

This young accountant is obviously fond of pi55ing money up the wall for no return-has he been headhunted yet by a private sector financial institution?

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=========================

This young accountant is obviously fond of pi55ing money up the wall for no return-has he been headhunted yet by a private sector financial institution?

Probably right. Theres probably a bunch of senile old credits salivating at the prospect of recruiting such a bold and aventurous young buck right now.

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Guest DissipatedYouthIsValuable
This begs the question as to why a trainee accountant was given authority over £44m of taxpayer's money.

I do like the avatar.

I think I may have lost the opportunity of taking a 10 day job doctoring on an Aegean cruise over insisting on being briefed of background health problems - "as these days, we cannot rely upon the Spartan-like vigour of the Greeks." The Greek chap organising it on behalf of his mystery boss seems to have been upset by it. I'm hoping it was Prince Philip.

Edited by DissipatedYouthIsValuable

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Guest DissipatedYouthIsValuable
did he get a 7 figure pay off as a reward for his shite performance?

Oh sorry no he didn't,I forgot- he didn't work in the private sector.

:lol:

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I would like to know how much salary a trainee accountant is paid by that Council. I suspect it is not brilliant so to have a trainee being able to do this beggars disbelief.

Government accountants on CIPFA , are paid alot,

A job I applied for was a council job , it paid 28K to start with. (Bolton Council) , I didn't get the job even though I was most qualified , most experienced etc....... ha funnily enough I was more qualified than what may have been my boss there and more experienced too... :lol:

I hadn't realised by then that council jobs are only advertised to go through the motions , as normally a relative or a good mate's son/daughter gets the job.

To compare , average starting salaries for PQs is about 13K, though I've seen it as low as 8K, training is supposed to be worth loads , but its usually £120 a year in the form of a couple of text books.

Anedotally from my research recently

ACAs anf ACCAs mostly tend to get stuck at 23K, FCCAs and FCAs get stuck at a ceiling of 25K-30K unless they go into industry, to get ACCA/ACA you need to sit tons of exams and have 3 years experience, to get FCA or FCCA you need 6 or is it 7 years post qualifcation experience.

EDIT I think CIPFA types are paid well namely as outside of the government their qualification isn't that high in demand.

Edited by kennichi

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I wonder why he didn't just transfer it to his own overseas bank account in a country without an extradition treaty, give a couple million to the government officials there to keep them happy and change your identity.

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Hang on did he not go to prison ?? oh sorry I forgot he worked for the public sector
did he get a 7 figure pay off as a reward for his shite performance?

Oh sorry no he didn't,I forgot- he didn't work in the private sector.

FIGHT, FIGHT, FIGHT!

Reading between the lines, it looks as if the council actually made a profit on the whole thing!

Well that's OK then. I guess it's OK these days to break the law if you make a profit from it. (Looking forward to a fun time in Manchester this September eh Pat?)

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Guest sillybear2

He should have gambled on housing instead, everyone knows it only goes up!

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Just illustrates how wimpish we are with white-collar crime compared to the USA - if it had been an employee of a US local authority doing this he would have been sent down for 40 years minimum.

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did he get a 7 figure pay off as a reward for his shite performance?

Oh sorry no he didn't,I forgot- he didn't work in the private sector.

Theres nothing private about the banking sector except its profits.

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Well, assuming he bought, right in the middle of a bloomin' great bounce, he would have struggled not to make money. On the radio yesterday they said he was only disciplined at work. Difficult to bollock someone for gambling £44m when there should have been processes to stop him doing so. Bit like hacking into a bank. They usually offer you a job showing them how to stop it happening again.

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