The government scheme was a popular way of gaining basic IT skills but proved wide open to fraud by bogus training agencies.
Investigations by VNU News Centre uncovered na‹ve security systems, which allowed fraudsters to clean out supposedly secure accounts, by changing the end digit of a known account number. The Public Account Committee estimated that as much as £97m may have been siphoned off in this way.
Ann Abraham, Parliamentary Ombudsman, said that the Department for Education and Skills was ‘guilty of serious maladministration’ for delivering a programme open to misuse and fraud.
The DfES said in a statement: ‘the delivery of Individual Learning Accounts fell a long way short of the standards that the public has a right to expect. It was unacceptable.’
IT services group Capita, which was contracted to build the ILA system, blamed the decision to allow unaccredited training firms to access accounts.
‘The system was designed for a closed community of learning providers. Without prior accreditation all users were placed in a position of trust,’ said Jonathon Hawker, external relations advisor at Capita.
Abraham concluded that trainees and training providers could be reimbursed for losses but rejected calls for a national compensation scheme for training agencies.
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