Five employees from a London council’s housing management company have been suspended over fraud allegations relating to repairs contracts won by Lakehouse.
Hackney Council has also launched its own investigation into Hackney Homes, the local authority’s arms-length management organisation.
The investigation is understood to be in relation to work carried out by Lakehouse or its sub-contractors on Hackney’s Decent Homes programme.
A separate police enquiry into fraud, unrelated to the Lakehouse allegations, is also underway, with one man having been arrested.
Lakehouse is understood to have completed its own internal investigation into the payments, which are thought to have taken place around 18 months to two years ago.
A spokeswoman for Hackney Council said: “Hackney Council’s audit and anti-fraud team is investigating a number of allegations relating to issues within Hackney Homes, the arms-length organisation which manages council housing in the borough.
“In the course of this, a number of staff have been suspended, and are now being dealt with through Hackney Homes’ internal disciplinary process.
“A separate allegation of fraud was referred immediately to the police. The Council continues to support the police in their ongoing investigation.”
Hackney Homes confirmed it had suspended five members of staff and would take further action if it found evidence of wrongdoing.