Two scheming swindlers have been jailed after they boldly cheated councils out of around £500,000 in a huge care home staffing scam project that they referred to as 'Dodge City.' The fraudsters have now been instructed to repay only £129,849 of the missing money, just over a quarter of what they stole.
Dimitri Reeder and his wife, Claire Reeder displayed ''pure greed'' during a crucial period of time for the adult social care services as they were under a massive amount of budget pressure, Hull Live reports. Claire Reeder who acted as a kind caring person was really a ''cynical manipulator'' behind closed doors who took great pleasure in the large amounts of money they were bringing in, Hull Crown Court heard.
They pair were jailed on November, 25 after Dimitri Reeder was sentenced to six years behind bars and Claire Reeder was given four years and nine months. But the case has now resurfaced at separate confiscation hearings when, firstly, Claire Reeder, now 41, of Kingsway, Cottingham, was ordered to pay compensation under the Proceeds of Crime Act of £112,802.
At the latest hearing, Dimitri Reeder, now 53, also of Kingsway, Cottingham, was ordered to pay only £17,047 after a dispute about the surrender value of a pension. The benefit figure on the fraud was put at £504,468.
The earlier trial of Dimitri Reeder last year was told that the loss to Hull City Council was at least £200,097 and for East Riding Council it was £204,952 - but that the actual true fraud was almost certainly much more. The court was told at the time that the total could have been nearer £500,000 than the "generous" investigation figure of only £405,000 officially estimated and used during the trial.
The total sum awarded in compensation will be split between the two councils. Dimitri Reeder appeared for the confiscation hearing via a video link from Kirkham Prison, near Preston, Lancashire.
The court heard that the prosecution originally claimed that the value of a pension that he had was £42,000 to £44,000 but that, after discussions with the defence, it was now accepted that its surrender value if withdrawn early before the age of 55 would be only £12,749 because of penalties. The total available amount from him was £17,047.
Dimitri Reeder had denied two offences of fraud involving Hull City Council between April 2011 and April 2013 and East Riding Council between July 2013 and March 2015. He had also denied false accounting on February 24, 2015 by falsifying a document for accounting purposes.
Reeder was convicted by a jury of the two fraud offences but was cleared of false accounting. His wife, Claire Reeder had earlier pleaded guilty to the two fraud offences.
James Gelsthorpe, prosecuting, told a previous sentencing hearing in November that the fraud involved grossly inflating invoices submitted for supplying agency staff to care homes in Hull and the East Riding. The couple ran two employment agencies, Proactive Health Partnership Ltd and Angels Careforce Ltd, and charged for huge numbers of hours that were never actually worked.
Invoices were fiddled and they joked that they deserved a "double sided extra large chufty badge with bells and neon lights and everything" because of the money they would make. The Reeders "deliberately and dishonestly deceived two local authorities" into paying their companies, which provided agency workers to care homes, more than £405,000 to which they were not entitled.
"The method was simple," said Mr Gelsthorpe. "They submitted invoices to Hull City Council and East Riding of Yorkshire Council for work which had not been done or for work that had already been billed. This deception was something in which they took a particular pride."
In an email exchange between them, Claire Reeder boasted: "According to recent calculations, we will be 90k over (aka Dodge City)". She wrote in large letters "90 f***in k" and Dimitri Reeder is said to have replied: "F***in hell. Ya dodgy b*****d. I luv ya."
In one flagrant fraud, Hull City Council was billed £46,188 - a huge mark-up of 1,111 per cent - for actual hours worked that were worth just £3,812. During police interview, Dimitri Reeder denied any wrongdoing and claimed that the systems in place at supply chain management companies for dealing with payments should have prevented any overcharging.
Claire Reeder claimed that it was a fault of the systems. Both had no previous convictions. Peter Holland, of Hull City Council, said in a statement that losses "directly impacted" the services that the council could provide.
Money had been allocated to the adult social care budget at a time when the general reserve was exceptionally low. The money could have been used to support the budget in future years or to support other services that were under greater immediate pressure.
This made the situation more difficult to manage and, in theory, money could have been returned to the taxpayer by offsetting future increases in council tax rates. Julian Neilson, of East Riding Council, said that the fraud placed extra pressure on social care budgets at a time when they were under "enormous strain" and during a period of public sector austerity.
One 40-bedded care home, in particular, had been affected at a time when it was in high demand. The fraud could ultimately have led to the service being considered financially unviable, with 38 people having to be rehomed, but because of cost savings made and council tax increases, this did not happen.
It was already a "difficult and upsetting time" for council officers because of significant pressures on budgets. Judge Mark Bury told the pair at the sentencing hearing in November: "These frauds are extremely serious. This was not a particularly sophisticated fraud.
''It was a cynically operated one where you had spotted a loophole in procedures. It was conducted over a long period." They were raking in about £100,000 a year and the total amount was more likely to be nearer £500,000 than £400,000.
"The money that you were taking wrongly was for the most vulnerable in our society, adult social care," said Judge Bury. Everyone knows how much value there is in that area. It's sadly the case that most families, in their lives, know somebody who needs adult social care when they are elderly or otherwise vulnerable.
''This fraud has the potential to make social care provision extremely difficult." Judge Bury said of Claire Reeder: "It's disappointing that someone who comes from a nursing background can behave in this way."
She was not, however, a nurse herself. Judge Bury told her: "You come across as a cynical manipulator of monies that were designed to protect the most vulnerable in our society.
''An unedifying aspect of this case is the delight that you both took in making this money. It's just pure greed."
Dimitri Reeder had taken at least £120,000 a year out of the companies for "drawings" to maintain his lifestyle. "You obviously set a high store by having material wealth," said Judge Bury.
"You are not at all remorseful. I have not detected any during the course of your evidence. It was a pack of lies." Stephen Robinson, mitigating, said at the November court hearing that those who knew Claire Reeder were surprised that she had involved herself in the frauds.
Mr Robinson said: ''she has let herself and others down. The money was not all going to her. There were "positive elements" to her character.''
Patrick Palmer, representing Dimitri Reeder at the sentencing hearing, offered no mitigation after the guilty verdicts but said that there were positive character references for him. He had been a very supportive father to his daughters and other family, the court heard.
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