IN STRICTEST CONFIDENCE
Security
Project Initiation Document (PID)
Project Title:
Product X Fraud Reduction
Version Control:
Version 1.1 — Dated 8 Feb 10
Author and Project David Jones
Manager:
Project Sponsor: Jain Murphy
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Contents
1. Background
1.1. Project Aim
1.2. Project Scope and Benefits
2. Project Phases
21
2.2
2.3
24
3. Project Organisation Structure
3.1. Organisational Diagram.
3.2. Roles and Responsibilities
4. Project Finance
5. Project Assumptions Risks and Constraints
Annex: A. Project Time Line
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1. Background
1.1 Project Aim
The aim of this project is to support the migration of all branches to Horizon Online
(HOL), primarily the cash verification exercise being carried out. It will identify and
address the potential for fraud risk and subsequent losses incurred.
1.2 Project Scope and Benefits
The project will focus on the fraud risk elements of the migration plan including:
¢ Input to the cash verification check process.
¢ Input to the roll-out plans for HOL migration (understand number of checks,
timescales, resource; skills & constraints)
Analysis on the number of potential cash shortages likely to materialise.
Identify suspicious M.1. activities in branches (pre, during and post migration).
Mitigate for the potential impact of cash shortages within the network, from a
fraud/contractual perspective.
2. Project Phases
Phase 1- Identification and measurement of fraud within HNGX
Phase 2- Mitigation options and recommendations
Phase 3- Mitigation implementation
Phase 4- Post implementation review
2.1 Identification and measurement of fraud within HNGX
e Report drafted and submitted to SLT and other Stakeholders.
e Basic analysis to ascertain likely impact of fraud cases.
e Ongoing monitoring/liaising during pilot migration.
2.2 Mitigation options and recommendations
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e All Stakeholders engaged and agreement secured on Security remits.
e The 15 x Investigators only call (where possible) on non investigation
colleagues (from all Strands) to assist in support officer capacity.
e Support officers assist with other elements of the investigations e.g.
tape transcripts, evidence gathering, witness statements, committals,
etc.
e 2 Fraud Team Leaders, 2 Financial Investigators and 4 Fraud Risk
Managers are PACE trained and can undertake enquiries.
e This increases the investigative resource by over 50%, though
allowances would need to be made in respect of individuals BAU
remits:
e Individuals in other Strands are PACE trained and could further
alleviate pressures on the Fraud Team by undertaking investigations
(with similar allowances made for BAU activities).
e Review current cases on hand (now/new year) and where appropriate
close non urgent or less priority, completed cases. NB: there have
been culls in recent years (ODR, BAU, previous reorganisations).
*Active case management is currently ongoing with the expectation of
a further reduction by Feb 2010.
e *As at Dec09, fraud casework currently has 143 active cases on hand:
running approximately 75% of capacity, with the ability to take on an
additional circa 40+ cases across the two teams.
e In preparation for HOL migration, audit team activity will be minimal in
December and January, further resulting in reduced fraud case files
being raised.
e Triggers and timescales to be confirmed as agreed (see Appendix 1) —
in a similar way that Audit/Contracts have a trigger for
involvement/suspension.
e Cases to be ‘stacked and packed’ — there may be delays in that cases
take longer to investigate, but dealt with in a priority order and as and
when basis.
e Assistance from elsewhere within RMG or externally could be
necessary if the volume of losses is higher and/or expectations
materialise re investigations.
2.3 Mitigation Implementation
The Project Manager will be responsible for ensuring that agreed recommendations
from phase 2.2 are successfully implemented. These will be considered and
factored into implementation as and when the need arises.
2.4 Post Implementation review
Following phase 2.3, losses within HNGX will be monitored on a regular basis to
assess the effectiveness and all results/outputs reported accordingly.
3. Project Organisation Structure
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3.1. Organisation Diagram
‘Andy Hayward
Fraud Risk Team
Project Manager
Dave Posnett
Fraud Risk Team:
[ [ I I 1
Project Team Project Team ‘Project Team Project Team
Network Support GR REBK 67 “Crime Risk Fraud Operations
John Breeden & Lin Cathy Macdonald & I I Jo Hancock & Helen Jason Collins &
Norbury {__ Alison Bolsover. Rose ‘Andrew Daley
Project Team:
‘Network Support
Adrian Wales &Sue
Richardson
3.2. Roles and Responsibilities
There are a number of individuals who will play an important role in ensuring the
success of this Project:
Andy Hayward Provide strategic direction and governance of the
Project
Dave Posnett Overall management of the Project
AW & SR Report on issues/progress/findings, and engage
JB&LN Discuss/deal with contracts — fraud/non fraud
CM & AB Provide data and monitoring function re branch
migrations
JH &HR Provide strategic analysis (recommendations/concerns)
JC & AD Deal with and discuss/agree on fraud resource/cases
4. Project Finances
The migration process will be conducted under Business As Usual. Within
this T&S costs will increase, but costs in respect of the Security Team should
be minimal, but dependent on the intervention undertaken.
e Current audit intervention realise shortages at 3-4% of visits. This
would equate to circa 400 offices with shortages following migration.
e Of this total approximately one third result in a criminal investigation,
potentially approximately 100-150 additional case files being raised.
*(In 2008/09 253 cases were raised, handled by 15 fraud
investigators).
e Audit deficiencies year to date amount to £613k, 89% of all casework
raised. Although the cash verification exercise could increase the total
of audit deficiencies, in mitigation given that branches will be informed
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5. Project Assumptions, Risks and Constraints
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Annex: Project Timeline
Project time-line showing how long each phase will take to complete.
Phase 1 Identification and measurement of fraud
within HNGX
Phase 2 Mitigation options and recommendations
Phase 3 Mitigation implementation
Phase 4 Post implementation review
April 10 May 10 Jun 10 July 10