Council tax worker who embezzled £1m ordered to repay £165,000
Michael Paterson, 60, had unrestricted access to a system which allowed him to issue refunds to council taxpayers up to £3,000.
A former Aberdeen City Council employee who embezzled more than £1 million over almost 20 years has been ordered to repay more than £165,000.
Michael Paterson, 60, was jailed for four years at the High Court in Edinburgh in July 2024, after pleading guilty to a charge of embezzlement.
On Monday at the High Court in Edinburgh, a confiscation order was made for £167,698.71 and recorded that his benefit from criminality was £1,184,000.
Between 2006 and 2023, Paterson, who was employed as a council tax and recovery team leader, issued 622 false refunds totalling £1,087,444.
He set up an internal pathway which allowed him to fraudulently issue council tax refunds into his own bank account, according to prosecutors at the Crown Office and Procurator Fiscal Service (COPFS).
Paterson had unrestricted and unmonitored access to a system which allowed him to issue refunds to council taxpayers up to £3,000.
But in September 2023, a colleague spotted an unusual refund conducted by “mikep” to the value of £2,899.81 to a customer who was not entitled to one.
The council’s counter-fraud department was alerted, and an investigation revealed the scale of Paterson’s crimes.
It showed that, between 2019 and 2023, the total sum of £376,042.85 was paid into a specific account by user “mikep”.
Further investigations revealed that between 2006 and 2019, a total of 490 refunds worth £711,401.62 were paid into the same account in which Paterson received his monthly council salary.
He was suspended from his job in September 2023 when the matter was reported to the police and dismissed from his employment three months later.
The court also made a compensation order in favour of Aberdeen City Council, ordering that the sum of £104,630.33, recovered as part of the confiscation proceedings, is paid to the local authority.
The sum of £417,523 has already been recovered by Aberdeen City Council from Paterson’s pension fund.
The confiscation order can be revisited if further assets are identified in the future to be paid towards the full amount that was determined as the benefit of the crime.
Sineidin Corrins, depute procurator fiscal for specialist casework at COPFS, said: “Michael Paterson committed an egregious betrayal of trust by taking advantage of his position to embezzle public money from his employers.
“We take such criminality very seriously. This confiscation order underscores the fact that prosecution of those involved in financial crime does not stop at criminal conviction and sentencing.
“Even after that conviction was secured, the Crown pursued Proceeds of Crime action to ensure funds he obtained illegally were confiscated.
“Confiscation orders have ongoing financial consequences, meaning we can seek to recover further assets from this individual in the future to ensure he pays back the full amount.”
