Ex-council worker who embezzled more than £1m jailed

Michael Paterson fraudulently issued Aberdeen City Council tax refunds into his own account.

Paterson was sentenced at the High Court in Edinburgh of Friday (PA) (PA Archive)

A former local authority worker who embezzled more than £1 million from Aberdeen City Council over a 17-year period has been jailed for four years.

Michael Paterson, 59, set up an internal pathway which allowed him to fraudulently issue council tax refunds into his own bank account.

Between 2006 and 2023, Paterson, who was employed as a council tax and recovery team leader, issued 622 refunds totalling £1,087,444.

He was jailed for four years at the High Court in Edinburgh on Friday after pleading guilty to a charge of embezzlement last month, the Crown Office said.

Paterson will now face confiscation proceedings to recover the money he embezzled.

This was a brazen example of an individual inflicting serious financial harm on a local authority

Moira Orr, Crown Office

Moira Orr, who leads on homicide and major crime for the Crown Office and Procurator Fiscal Service (COPFS), said: “This was an egregious betrayal of trust by a council worker who took advantage of his position to embezzle public money from his employers.

“Embezzlement is not a victimless crime. This was a brazen example of an individual inflicting serious financial harm on a local authority.

“Michael Paterson embezzled a significant sum of money. We take such criminality very seriously and COPFS has commenced proceedings to recover the benefit he gained from his criminal enterprise.

“This conviction should send a strong message to others involved in this kind of criminal behaviour.”

Prosecutors said Paterson had unrestricted and unmonitored access to a system which allowed him to issue refunds to council taxpayers of up to £3,000.

In September last year, a colleague spotted an unusual refund conducted by “mikep” to the value of £2899.81 to a customer who was not entitled to one.

As a result, the council’s counter fraud department was alerted, and a widespread investigation eventually 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 £711,401.61 were paid into the same account in which Paterson received his monthly council salary.

Paterson was suspended from his job in September 2023 when the matter was reported to police and was dismissed from his employment three months later.

The Crown Office said the 59-year-old will now be the subject of confiscation action under Proceeds of Crime legislation.