The police have dropped their criminal investigation against Aspire Achieve Advance (3aaa) – although the Insolvency Service continues its enquiries into the former apprenticeship giant.
Derbyshire Constabulary said it had run into “evidential difficulties”. Following a meeting with the Education and Skills Funding Agency (ESFA) on November 29, 2019, it decided to not pursue the case.
Neither the police nor the ESFA would provider further detail, but a spokesperson for the Department for Education said it would “not hesitate to take swift and decisive action against those who attempt to break, or manipulate the rules, regardless of whether the relevant authorities take forward criminal proceedings”.
“Since the investigation into 3aaa, the ESFA has toughened up on oversight of providers,” he added, “and we have established tighter monitoring controls.”
A spokesperson for Derbyshire Constabulary said a “formal criminal investigation” into 3aaa began in March 2019, following a “number of fraud allegations made by the DfE”.
The government terminated its multi-million pound skills funding contracts with the provider in October 2018, following a five month investigation. The case was then passed to the police through Action Fraud. This was the DfE’s second investigation into the provider in two years.
The provider went bust and the High Court placed 3aaa into compulsory liquidation in late October 2018. Anthony Hannon was then made the official receiver handling the insolvency.
His investigation into the collapse is still ongoing.
Although Derbyshire Constabulary has dropped its case against the defunct provider, the insolvency service told FE Week that if Hannon does find evidence of criminality he can refer the findings to another prosecuting authority, such as the Serious Fraud Office.
The Insolvency Service has three years from the date of the company winding-up order to launch enforcement action “if it was to determine doing so was in the public interest in the light of any investigation findings”.
Sanctions imposed by the official receiver, if he uncovers unfit director conduct, include director disqualification of between two and 15 years.
3aaa had 4,200 learners and 500 staff on its books when it went bust.
The firm was holding £16.5 million in ESFA contracts, and received more than £31 million in government funding the year before its collapse.
Whistleblower evidence obtained by FE Week, showed how the provider inflated achievement rates by more than 20 percentage points.
Sales documents for 3aaa showed a potential £700,000 ESFA clawback. It is understood that this related to a range of apprenticeship and traineeship funding overclaims made through individualised learner record submissions.
The ESFA also investigated the alleged misuse of grants from an apprenticeship incentive scheme.
Nor was this the first ESFA investigation into 3aaa: in 2016 the auditing firm KPMG was asked to carry out an investigation and found dozens of funding and success rate “overclaims”.
It is understood this resulted in the provider paying back a substantial six-figure sum.
After launching its second investigation into 3aaa in June 2018, the DfE called in an independent auditor, Alyson Gerner, to investigate the ESFA over its contract management of the former apprenticeships giant.
3aaa was co-founded by former Derby County Football Club owner Peter Marples and Di McEvoy-Robinson in 2008. They both stepped down in September 2018.
Neither Marples nor McEvoy-Robinson had responded to requests for comment at the time of our going to press.