A fraud trial heard today how an internal auditor from the Welsh Government found significant and fundamental failures in the financial controls of one of its scheme set up to alleviate poverty.
It led to a full investigation which uncovered a culture of generosity among staff in the Plas Madoc Communities First project.Clare Collett, of the Welsh Government's internal audit service, made a two day visit to Plas Madoc in 2009 for a review of the files and found the failures in the financial controls in place.
In evidence at Mold Crown Court, she said that there was confusion about the ownership of a caravan which was used by residents for holidays at Rhyl.Co-ordinator Miriam Beard, who is on trial for fraud charges she denies, told her that the charity owned the caravan but said that they had kept it fairly quiet because they did not want the residents to know.
It was felt that if they did, then they would feel that they would have a right to use the caravan when they wanted to.
The prosecution say Beard purchased the caravan for £9,000 then paid rent for it to one of her sons but then claimed that he was being paid to maintain it and keep an eye on it.
It is alleged that she defrauded the charity by paying more than £25,000 into the bank account of her elderly father, names as a Mr D Gay, and then diverting the money to her own.It was invoiced as providing drama tuition for young people although it is claimed her father knew nothing about it.
Beard claims that the money was paid out with the approval of the board when it was not used up at the end of the financial year – so that it would not have to be returned to the Assembly. It was later used for future projects, she says.Miss Collett said Beard had said that she had given her fuel card to Sinead Moynihan, a Hollyoaks actress, and had told her that it was to be used once a week when travelling to Plas Madoc to provide drama classes.
But the prosecution say that her son, who was Miss Moynihan's partner, ran up a £4,000 bill on the fuel card. There is no suggestion of any wrongdoing by the actress.
Cross examined by Russell Davies, defending Beard, Miss Collett agreed that problems in financial controls were previously identified in 2003 during a review by Wrexham council but there was no evidence of any follow-up.
Mr Davies said that while his client was in the dock, the Welsh Government audit raised wider concerns than her role and said there were control weaknesses throughout the organisation. He said the board of trustees had not effectively discharged its duties.
He suggested that his client was an creative and artistic person rather than an accountant, and was not qualified to coordinate and control financial matters.Mr Davies said that while Beard's two sons had been employed by the charity, it was clear that other people, including board members, had families working for it.Beard, 55, is alleged to have milked the charity, set up to improve the large estate near Wrexham, one of the poorest in Wales, out of more than £54,000.Beard, of Tryfan Uchaf at Henllan near Denbigh, denies 12 charges of fraud in a position of trust and one of joint theft with her husband.James Beard, 46, of the same address, denies eight charges - six charges of fraud and two of theft.The case continues.