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papercamp A massive alleged embezzlement scandal has been uncovered at a small government agency that looks after the funds of the most vulnerable Canberrans.

The office of the Public Trustee for the ACT has stood down two staff on full pay after discovering money was allegedly wrongly taken from people whose assets it held in trust. Public Trustee Andrew Taylor said police and the auditing firm KPMG were investigating what he called irregularities in accounts.

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Mr Taylor said he could not discuss the allegations in detail. However, sources say the amount exceeded $1 million, and the office believes third parties, such as contractors, may have been involved by inflating prices on invoices.

It is believed the alleged embezzlement took place over years and involved hundreds of accounts.

The trustee helps to care for Canberrans who, as a result of illness, accident or disability, must give someone else the power of attorney to make decisions on their behalf. The small office also administers estates of the deceased.

Mr Taylor said none of the trustee's clients would lose money as its funds were guaranteed and insured. ''The well-being of our clients is our absolute priority and of paramount concern, and the issue of restitution is foremost in our minds,'' he said.

The office had never experienced any noteworthy fraud in the three decades it had operated.

''The staff we employ here take a very strong vocational interest in their work,'' Mr Taylor said. ''They are a certain kind of person who care about what they do, and they've taken it pretty hard.

''They feel it [the alleged fraud] may reflect on their own work, which is not the case. But there's a very sombre mood here.''

Mr Taylor suspended two employees on full pay on the advice of lawyers and as required by the staff's enterprise bargaining agreement.

No one had yet admitted taking money wrongly, he said.

The office employs fewer...