Learning scheme riddled with fraud

Widespread fraud has been exposed in the operation of Individual Learning Accounts (ILAs), the flagship government scheme which pays individuals up to £200 towards the cost of a training or education course.

Police are currently investigating the abuse and a number of people have been arrested for "significant fraud" against the Department for Education and Skills. More than 8,000 companies have registered as learning providers but there has been very little scrutiny of the quality of courses offered. Some have now been identified as using dubious methods to trick people into signing away their £200 ILA entitlement.

The scams include aggressive door-to-door "selling" of training courses, particularly computer training, where people have signed up for training courses which turn out to be bogus or worth substantially less than £200. A common scam has involved offering a computer course, but sending only a text book worth £6.99, even though individuals had signed away their £200 ILA. In other cases training companies forged people's signatures in order to obtain their ILA funding.

Adult skills minister John Healey rejected the idea that the scheme is fundamentally flawed although he admitted there are problems and said it would be tightened up.