Arrests have been made as part of an investigation into allegations of fraud at the former Adam Smith College.
Police have been carrying out inquiries into the running of Adam Smith College in Kirkcaldy, now part of Fife College, after two separate probes by auditors KPMG and the Scottish Government, which resulted in the institution being ordered to pay back £5.5 million in EU grants.
Voluntary severance payments made to two individuals that were not in line with college policy were uncovered by the investigations, as well as a lack of documentation around a number of decisions, including the personal use of college facilities and suppliers.
A report by accountancy firm Grant Thornton, which was made public last year, said that KPMG had found the college’s financial regulations had not been adhered to when it came to hiring two companies for a marketing strategy review.
KPMG also found evidence the college had submitted claims to grant funding bodies that were “inaccurate, unsupported by evidence and overstated” since at least 2007.
A later investigation by Scottish Government auditors found “significant irregularities” including the apparent systematic over-claiming of staff time, according to the report.
Police confirmed today their investigation was continuing but a series of arrests had been made.
Police would not say how many arrests had taken place or who they were.
The inquiry into the college’s finances began after an earlier investigation by the Scottish Funding Council (SFC) into alleged bullying at the institution.
Former principal Dr Craig Thomson resigned in March 2012 a week after he had been suspended indefinitely when the SFC launched its investigation into allegations of bullying, intimidation and the misuse of funds.
His replacement, Ian Harrington, was suspended as interim principal on the orders of the college board while the investigations into the misuse of funds were carried out. He later left the college.
Adam Smith College merged with Carnegie College in Dunfermline to form Fife College in August last year.