Caerphilly Council Chief Executive arrested on suspicion of fraud

Update 20.52pm - The other individual who was arrested today along with Anthony O'Sullivan was his deputy Nigel Barnett, who has been acting chief executive of the authority since his boss was suspended in March. (Western Mail)
Avon & Somerset Police are conducting the investigation because Gwent Police was considered to be too close to Caerphilly council.

Due process will now follow.

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Interesting developments in Caerphilly, south Wales, as reported below by the Western Mail;

Chief executive of Caerphilly Council arrested on suspicion of fraud
2 Jul 2013 13:12 by Martin Shipton

The chief executive of Caerphilly council, Anthony O'Sullivan is one of two officials arrested on suspicion of fraud and misconduct of public office, we can reveal. 

The arrests come as part of an investigation being undertaken by Avon & Somerset Police into huge secret pay rises awarded to 21 senior officers of the council. 

The rises followed recommendations made in a report by chief executive Anthony O’Sullivan. 

A statement issued by Avon & Somerset Police said: “Following a request to carry out a review by the Wales Audit Office two people have been arrested on suspicion of fraud and misconduct in public office. “They currently remain in police custody where they are being questioned. “It would be inappropriate to comment further at this stage.”

Sources close to the inquiry have confirmed that one of the individuals arrested is Mr O’Sullivan. 

After writing the report last year, Mr O’Sullivan’s own salary rose from £132,000 to £158,000 after the increases were approved by a committee of one Plaid Cymru and four Labour councillors. 

A further 20 senior managers also received a substantial pay rise, but the bulk of the council’s staff were on the third year of a pay freeze. 

The rises were rescinded in January after a public outcry, and under a compromise Mr O’Sullivan’s increase went down from £26,000 to £5,000. 

The chief executive was suspended in March on full pay after a report from the Assistant Auditor General for Wales, Anthony Barrett, said various aspects of the pay award were unlawful. 

Mr O’Sullivan was said to have acted unlawfully  by writing a report that recommended massive increases for himself and senior colleagues, and by being present at a committee meeting when the rises were approved. 

The actions of Mr O’Sullivan first came to light when information was leaked. 

Mr Barrett, the council’s Appointed Auditor, said in the report, published in March: “I have concluded that the decision by the Senior Remuneration Committee on September 5, 2012 to approve the pay structure set out in the report of the chief executive was unlawful on a number of grounds. 

“The first is that the meeting of the Senior Remuneration Committee was not properly advertised in accordance with the Local Government Act and neither were agendas for the meeting made available for public inspection as they should have been. 

“Certain officers, including the chief executive, who would have been (and indeed were) beneficiaries of the decision were present at the meeting to approve the salary increases. 

“No declarations of interest were made and these officers did not leave the room while the decision was made. Consequently they participated in the decision making process when they had a disqualifying financial interest. 

“Additionally, the report presented to the committee was written by the chief executive who was himself a direct beneficiary of the decision made and who gave advice on a matter in which he had a financial interest.” 

We have asked Caerphilly council to comment on today’s arrests