Danish social agency freezes payouts after embezzlement scandal

Socialstyrelsen, an administrative department of the Ministry for Children and Social Affairs, has temporarily shut down payments of special funds for social projects.

Danish social agency freezes payouts after embezzlement scandal
Minister for Children and Social Affairs Mai Mercado. Photo: Mads Claus Rasmussen/Ritzau Scanpix

The decision is directly connected to a long-standing embezzlement affair at the agency, details of which were made public by the ministry last week.

Minister for Children and Social Affairs Mai Mercado confirmed on Monday the connection between the misappropriation affair and the closure of the payment system.

“The embezzlement affair at Socialstyrelsen is so serious that the agency feels it is necessary to freeze payment of grants for a period of time in order to ensure that the money goes to the societies and organisations to which it was awarded,” Mercado said.

Last week, Mercado’s ministry confirmed that a former Socialstyrelsen employee was wanted by police for long-term misappropriation of public funds totalling 111 million kroner ($17.23 million). The money is reported to have been taken in many cases from state funds intended to benefit socially underprivileged people.

The issue has therefore resulted in the agency withholding October payments from such groups.

Mercado said that the funds would be paid as soon as possible.

READ ALSO: Warnings of irregularities at Danish social welfare authority raised in 2006


Former Danish social worker convicted of massive fraud

A former employee of Denmark's social services was sentenced to six and half years in prison on Tuesday for embezzling millions in funds, meant for people in need, over decades.

Former Danish social worker convicted of massive fraud
Britta Nielsen's defence lawyer Nima Nabipour speaks to media. Photo:Liselotte Sabroe/Ritzau Scanpix

Britta Nielsen, 65, was accused of diverting 117 million Danish kroner (15.7 million euros) between 1993 and 2018 from the social services to her personal bank accounts by creating fictitious projects.

In its verdict, the Copenhagen court found Nielsen guilty of “fraud of a particular grave nature… abusing a public position and forgery of a particular grave nature”.

The six year and six month prison sentence is one of the longest handed down for economic crimes in the country, according to Danish media.

Prosecutors had requested at least eight years in prison, claiming she had abused her position as a public servant.

“She has betrayed the trust she was given when she became employed by the National Board of Social Services,” prosecutor Lisbeth Jørgensen told the court during the trial.

Nielsen, who was employed by the social services agency for 40 years, admitted to the fraud but not the amount of money suggested by the prosecution.

During the trial, she explained that she had been drawn into a “vicious circle” and claimed she had acted to improve to the lives of her three children, who have also been charged with handling of stolen goods.

Her lawyer, Nima Nabipour, has asked for a sentence of four to six years, arguing that crimes committed before 2009 have reached their statute of limitations.

The court however found her liable for the embezzling of the full 117 million.

Nabipour has also pleaded mitigating circumstances, like Nielsen's age and health.

The trial has had to be adjourned several times due to Nielsen collapsing in court and being too ill to stand trial.

However, a medical examination found her to be in good health.

Nielsen was arrested in late 2018 in South Africa, where she had fled, and later extradited to Denmark.

In addition to her jail sentence over 113 million kroner of Nielsen's assets were confiscated.