Two benefit thieves who stole £11,000 each have received suspended prison sentences (h/t VNCounterFraud).
Mark Stimpson, from Botley, failed to inform the Vale of White Horse District Council that he had worked at two different pubs between March 2009 and May 2012, and received housing benefit he was not entitled to as a result. He was given a six-week prison sentence suspended for 12 months and ordered to complete 80 hours unpaid work.
A Berrow pensioner worked on a seasonal basis over three years whilst claiming Pension Credit, Housing Benefit and Council Tax Benefit. The overpaid benefit amounted to nearly £11,000 and the offender has been sentenced to three months' imprisonment, suspended for two years.
16 May 2013
Another benefit thief gets away with it
At Redhill Magistrates’ Court, Raymond O’Connor, from Caterham, pleaded guilty to benefit fraud of £8,466. He was given a two year Conditional Discharge and ordered to pay £540 towards prosecution costs.(h/t Dave)
In April 2011 Mr O’Connor was receiving Housing and Council Tax Benefit and Jobseekers Allowance, but did not notify Tandridge District Council or the Department for Work and Pensions he had started full time work.
During a joint investigation into Mr O’Connor’s benefit claims, he was interviewed in April 2012 by officers from the Council and Department for Work and Pensions. He claimed he had stopped registering as a Jobseeker, as he had started work in April 2012. Evidence from his employer showed he had actually started working for the company in April 2011.
In August 2012, Mr O’Connor was interviewed again and admitted he had been working full time since April 2011. This meant Mr O’Connor should not have received Jobseekers Allowance, Housing Benefit and Council Tax Benefit since April 2011.
As a result he had been overpaid benefit of £8,466. Mr O’Connor will have to repay the debt to the Council and Department for Work and Pensions.
He's just been told to go away and not do it again.
In April 2011 Mr O’Connor was receiving Housing and Council Tax Benefit and Jobseekers Allowance, but did not notify Tandridge District Council or the Department for Work and Pensions he had started full time work.
During a joint investigation into Mr O’Connor’s benefit claims, he was interviewed in April 2012 by officers from the Council and Department for Work and Pensions. He claimed he had stopped registering as a Jobseeker, as he had started work in April 2012. Evidence from his employer showed he had actually started working for the company in April 2011.
In August 2012, Mr O’Connor was interviewed again and admitted he had been working full time since April 2011. This meant Mr O’Connor should not have received Jobseekers Allowance, Housing Benefit and Council Tax Benefit since April 2011.
As a result he had been overpaid benefit of £8,466. Mr O’Connor will have to repay the debt to the Council and Department for Work and Pensions.
He's just been told to go away and not do it again.
15 May 2013
Gran, 54, jailed for £74k benefit theft
Benefit cheat gran Kay Wilson pocketed £74,769 in incapacity handouts over eight years – despite having a full-time job paying almost £20,000-a-year.
The 54-year-old was still being paid disability living allowance and severe disablement allowance when she was working between 2003 and 2011.
Her employers included Leek Golf Club, car dealer Knights North West Limited, Longton-based Rock House Training and Wrights Pies.
It meant Wilson was earning between £15,000 and £20,000-a-year at work – and then receiving more than £9,000-a-year tax-free in state handouts.
Now Wilson has been jailed for 32 weeks at Stoke-on-Trent Crown Court after admitting two charges of failing to notify a change of circumstances in relation to her benefit claims between April, 2003 and December, 2011.
Jailing Wilson, Judge Paul Glenn said:
And on a renewal form in 1998 she stated she had suffered three strokes in the past five years and had difficulties getting out of bed and dressing herself.
But Wilson carried on claiming the benefits when she started working at Leek Golf Club, where she lived with her husband, in November 2002.
She then moved on to other jobs before landing a job at Wrights Pies in November 2008.
In 2011, Wilson was photographed by The Sentinel with other work colleagues stripping off for a charity calendar raising money for cancer charities.
The court heard £11,108.86 of the £74,769 was written off when Wilson was declared bankrupt last year.
Jason Holt, mitigating, said Wilson suffered a severe stroke at the age of 34 and was wheelchair-bound for two years. She had further strokes and suffered depression.
Mr Holt said: "At times she was well enough to work."
The 54-year-old was still being paid disability living allowance and severe disablement allowance when she was working between 2003 and 2011.
Her employers included Leek Golf Club, car dealer Knights North West Limited, Longton-based Rock House Training and Wrights Pies.
It meant Wilson was earning between £15,000 and £20,000-a-year at work – and then receiving more than £9,000-a-year tax-free in state handouts.
Now Wilson has been jailed for 32 weeks at Stoke-on-Trent Crown Court after admitting two charges of failing to notify a change of circumstances in relation to her benefit claims between April, 2003 and December, 2011.
Jailing Wilson, Judge Paul Glenn said:
Benefit fraud costs this country millions of pounds a year – money that comes from the pockets of ordinary, honest taxpayers.The court heard Wilson, from Wetley Rocks, started claiming benefits in 1993 on the basis it would take her 20 minutes to walk 10 yards with a walking stick and she was prone to falling.
People like you, benefit cheats, take away precious public resources which would otherwise be spent on worthy causes.
You knew what you were doing was wrong. You did not voluntarily desist from the false claims, you were caught. You got used to that additional income which was easy money.
And on a renewal form in 1998 she stated she had suffered three strokes in the past five years and had difficulties getting out of bed and dressing herself.
But Wilson carried on claiming the benefits when she started working at Leek Golf Club, where she lived with her husband, in November 2002.
She then moved on to other jobs before landing a job at Wrights Pies in November 2008.
In 2011, Wilson was photographed by The Sentinel with other work colleagues stripping off for a charity calendar raising money for cancer charities.
The court heard £11,108.86 of the £74,769 was written off when Wilson was declared bankrupt last year.
Jason Holt, mitigating, said Wilson suffered a severe stroke at the age of 34 and was wheelchair-bound for two years. She had further strokes and suffered depression.
Mr Holt said: "At times she was well enough to work."
14 May 2013
Pay it all back now
A benefit cheat pocketed over £38,000 income support by claiming to have no savings when he had up to £60,000 stashed in bank accounts. (h/t Dave)
Wolverhampton Crown Court heard how Mohinder Sohota got away with the scam for five and a half years until officials were tipped off by the Inland Revenue about the amount of interest he was earning from the secret cash deposits.
Mr Alistair Redford, prosecuting, said Sohota, from Smethwick, first signed a form claiming to be eligible for benefits because he had no savings in September 2006 when he had £49,410 in savings. This had soared to £60,663 by the time the fraud was uncovered, it was revealed.
The 56-year-old trickster also had shares and opened another bank account and put £15,000 in it to pay for an extension to his home, the court was told. Mr Redford concluded: “This was fraudulent from the outset.”
But Mr Devon Small, defending, argued: “It was the result of a genuine mistake. The defendant does not speak English and was acting on the advice of a friend.”
Mr Small conceded that other forms were subsequently signed by father-of-three Sohota who did not regard much of the money as belonging to him since it was saved for the weddings of his daughters.
Sohota, who was of previous good character, admitted false representation and is now paying back the money at the rate of £100-a-week.
Why? Take his savings now!
Recorder Stephen Campbell told him: “You obtained a significant amount of money over a protracted period while having significant personal savings but I am going to take what some will consider a lenient course. This is because you pleaded guilty, have not been in trouble before, are making repayments.”
Sohota received an eight month jail sentence suspended under supervision for a year.
Wolverhampton Crown Court heard how Mohinder Sohota got away with the scam for five and a half years until officials were tipped off by the Inland Revenue about the amount of interest he was earning from the secret cash deposits.
Mr Alistair Redford, prosecuting, said Sohota, from Smethwick, first signed a form claiming to be eligible for benefits because he had no savings in September 2006 when he had £49,410 in savings. This had soared to £60,663 by the time the fraud was uncovered, it was revealed.
The 56-year-old trickster also had shares and opened another bank account and put £15,000 in it to pay for an extension to his home, the court was told. Mr Redford concluded: “This was fraudulent from the outset.”
But Mr Devon Small, defending, argued: “It was the result of a genuine mistake. The defendant does not speak English and was acting on the advice of a friend.”
Mr Small conceded that other forms were subsequently signed by father-of-three Sohota who did not regard much of the money as belonging to him since it was saved for the weddings of his daughters.
Sohota, who was of previous good character, admitted false representation and is now paying back the money at the rate of £100-a-week.
Why? Take his savings now!
Recorder Stephen Campbell told him: “You obtained a significant amount of money over a protracted period while having significant personal savings but I am going to take what some will consider a lenient course. This is because you pleaded guilty, have not been in trouble before, are making repayments.”
Sohota received an eight month jail sentence suspended under supervision for a year.
- Benefit thieves do it for the money. They should know they will have to pay back twice what they stole. They should not be eligible for any benefits until they have, and they should have to do some unpaid work every week until the debt to society is cleared.
That would be a deterrent.
A confiscation order should be made immediately.
Any benefit thieves who don't go to prison should also have to do unpaid work.
10 May 2013
Repeat offender jailed for benefit fraud
A benefit fraudster who scammed taxpayers out of thousands has been jailed. (h/t VNCounterFraud)
Denise Dyson - one half of a married couple who unlawfully acquired more than £45,000 between them - was jailed for nine months at Manchester Crown Court.
Dyson, of Newland Avenue, Pemberton, failed to notify the Department of Work and Pensions of her marriage to husband Terence in 2001 and that she was living with him. And between 2006 and 2011 she claimed income support as a single occupant plus Council Tax benefit from the council and was overpaid £22,000 in total.
Mrs Dyson did not inform her family that she was due in court - such was her confidence she would not receive a custodial sentence - and a missing persons report was filed in her name when she did not return home after her hearing, Greater Manchester Police confirmed.
Coun Ged Bretherton, cabinet member for corporate resources, praised the local authority’s fraud officers for bringing her to justice:
Dyson fooled authorities by claiming her benefits under her maiden name of Denise Anglesea. She had also received a previous conviction in 2010 for working while in receipt of benefits, unlawfully claiming more than £9,000, and received a 12-month Community Order.
Earlier this year Terence Dyson escaped a custodial sentence after pleading guilty to three theft offences - more.
Denise Dyson - one half of a married couple who unlawfully acquired more than £45,000 between them - was jailed for nine months at Manchester Crown Court.
Dyson, of Newland Avenue, Pemberton, failed to notify the Department of Work and Pensions of her marriage to husband Terence in 2001 and that she was living with him. And between 2006 and 2011 she claimed income support as a single occupant plus Council Tax benefit from the council and was overpaid £22,000 in total.
Mrs Dyson did not inform her family that she was due in court - such was her confidence she would not receive a custodial sentence - and a missing persons report was filed in her name when she did not return home after her hearing, Greater Manchester Police confirmed.
Coun Ged Bretherton, cabinet member for corporate resources, praised the local authority’s fraud officers for bringing her to justice:
Wigan Council takes a tough stance on benefit fraud, as demonstrated in this case. I’d like to thank the DWP and our officers whose hard work helped to bring this case to court. Benefits are there for people who need them, who depend on them to live.Of course she won't be in prison for the full nine months.
They are not for those who think they can get away with fraudulently claiming money. Mrs Dyson found out the hard way and will, as a result of her crime, serve the next nine months in prison and pay all the money back.”
Dyson fooled authorities by claiming her benefits under her maiden name of Denise Anglesea. She had also received a previous conviction in 2010 for working while in receipt of benefits, unlawfully claiming more than £9,000, and received a 12-month Community Order.
Earlier this year Terence Dyson escaped a custodial sentence after pleading guilty to three theft offences - more.
Havering prosecutes social housing frauds, gets govt grant
A Romford man has been jailed for six weeks for benefit fraud after illegally subletting his council house. (h/t VNCounterFraud)
John Delgado, 34, was jailed for six weeks at Romford Magistrates' Court yesterday, Thursday May 9 after he pleaded guilty to fraudulently claiming more than £14,000 in benefits.
Delgado had been claiming both housing and Council tax benefit since 1993 while living in a Council home in Harold Hill.
But an investigation by Havering Council found that in 2009 he had moved in with his partner at her home in Romford and was illegally subletting his Council property for profit.
Magistrates handed down an immediate custodial sentence due to aggravating factors including the length of time Delgado continued to fraudulently claim benefits, the large amount he defrauded from the Council, that his acts were motivated by greed and that he had shown no remorse for his actions.
His Council home has now been retrieved by the council and given to another tenant who had been on the waiting list.
In a separate case, Harold Hill resident Gary Hicks, 50, was also sentenced to six weeks in prison, suspended for two years, and given a curfew from 7pm to 7am daily, for fraudulently claiming benefits.
Hicks admitted claiming almost £9,000 in housing and Council tax benefit. He was also not living in his Council home, in Dartfields, Harold Hill and was subletting the address. An investigation was launched following a tip-off from a neighbour who said he had not lived there for 12 years.
He will also be electronically tagged for three months and was ordered to pay £500 towards prosecution costs and an additional £80 victim surcharge. The Council has also taken steps to retrieve his Council home.
To help continue investigating cases such as these, Havering Council has recently received a £200,000 grant from the Government. This money will help the Council continue to tackle housing fraud and retrieve Council homes which are not being used correctly for families in need.
It will fund investigators and prosecutions and, during the next two years, the Council hopes to retrieve an additional 100 properties from fraudsters.
Housing fraud is undertaken in a number of ways, such as subletting or not using a property as a main residence or illegally obtaining a property.
Councillor Roger Ramsey, Cabinet Member for Value, said:
John Delgado, 34, was jailed for six weeks at Romford Magistrates' Court yesterday, Thursday May 9 after he pleaded guilty to fraudulently claiming more than £14,000 in benefits.
Delgado had been claiming both housing and Council tax benefit since 1993 while living in a Council home in Harold Hill.
But an investigation by Havering Council found that in 2009 he had moved in with his partner at her home in Romford and was illegally subletting his Council property for profit.
Magistrates handed down an immediate custodial sentence due to aggravating factors including the length of time Delgado continued to fraudulently claim benefits, the large amount he defrauded from the Council, that his acts were motivated by greed and that he had shown no remorse for his actions.
His Council home has now been retrieved by the council and given to another tenant who had been on the waiting list.
In a separate case, Harold Hill resident Gary Hicks, 50, was also sentenced to six weeks in prison, suspended for two years, and given a curfew from 7pm to 7am daily, for fraudulently claiming benefits.
Hicks admitted claiming almost £9,000 in housing and Council tax benefit. He was also not living in his Council home, in Dartfields, Harold Hill and was subletting the address. An investigation was launched following a tip-off from a neighbour who said he had not lived there for 12 years.
He will also be electronically tagged for three months and was ordered to pay £500 towards prosecution costs and an additional £80 victim surcharge. The Council has also taken steps to retrieve his Council home.
To help continue investigating cases such as these, Havering Council has recently received a £200,000 grant from the Government. This money will help the Council continue to tackle housing fraud and retrieve Council homes which are not being used correctly for families in need.
It will fund investigators and prosecutions and, during the next two years, the Council hopes to retrieve an additional 100 properties from fraudsters.
Housing fraud is undertaken in a number of ways, such as subletting or not using a property as a main residence or illegally obtaining a property.
Councillor Roger Ramsey, Cabinet Member for Value, said:
We want our message to be clear to fraudsters; you won't get away with it in Havering. We are looking for you and we will find you.Well said.
Council housing is there for the most vulnerable people in our communities and we will take all necessary steps to prevent people from obtaining a home and not using it for the reason it was given. With a waiting list of local families in need, we will do everything we can to ensure any homes being used fraudulently are returned to us so that deserving families can live in them.
5 May 2013
Kenyan immigrant systematically stole benefits
A benefits cheat who raked in so much cash she bought three homes in London and one in her native Kenya has been ordered to repay £300,000.
Gladys Popoola claimed the 'full range' of benefits, despite the fact that she had three jobs and her husband worked – building up a half million pound property portfolio. (More detail here.)
The 47-year-old admitted 16 counts relating to fraud at Southwark Crown Court and was jailed for 24 months last year.
Her six-year web of deceit started as soon as she was granted leave to remain in Britain in 2004.
She began applying for the full range of welfare, including income support and housing and council tax benefits, despite the fact her husband, John Ndirangu, had a job.
Mother-of-one Popoola duped the authorities into giving her two National Insurance numbers, one in her real name and the other in her maiden name, so she could work and claim at the same time.
When she was caught in 2011, she worked three jobs - two in housing groups and one at the Hammersmith and Fulham council – but still claimed Jobseeker's Allowance.
In that time, she bought properties in Cricklewood, Forest Gate and Clapton – and even one in Kenya.
The fraudster also claimed legal aid in civil proceedings against her last year and made money by renting out her London homes.
Popoola, of north west London, was jailed for two years in March 2012 after admitting 13 counts of benefit fraud and three other counts of fraud relating to obtaining a national insurance number.
She has already been released on licence after serving less than half of her sentence.
David Jugnarain, prosecuting, said her fraud also included an application to the government for maternity pay, despite the fact she was already receiving it.
He said at the original court case: ‘The value of the fraud in this case is just in excess of £200,000 .’
In addition, she falsely claimed legal aid when she was sacked from the council, when they realised she working another job despite the fact she was signed off sick.
Popoola has now - after all this time, she was jailed 14 months ago - been ordered to repay a total of £304,079, including £186,000 compensation to Westminster City Council and HMRC, within six months.
The cash will be taken from her assets which are holed up in her three UK properties.
Gladys Popoola claimed the 'full range' of benefits, despite the fact that she had three jobs and her husband worked – building up a half million pound property portfolio. (More detail here.)
The 47-year-old admitted 16 counts relating to fraud at Southwark Crown Court and was jailed for 24 months last year.
Her six-year web of deceit started as soon as she was granted leave to remain in Britain in 2004.
She began applying for the full range of welfare, including income support and housing and council tax benefits, despite the fact her husband, John Ndirangu, had a job.
Mother-of-one Popoola duped the authorities into giving her two National Insurance numbers, one in her real name and the other in her maiden name, so she could work and claim at the same time.
When she was caught in 2011, she worked three jobs - two in housing groups and one at the Hammersmith and Fulham council – but still claimed Jobseeker's Allowance.
In that time, she bought properties in Cricklewood, Forest Gate and Clapton – and even one in Kenya.
The fraudster also claimed legal aid in civil proceedings against her last year and made money by renting out her London homes.
Popoola, of north west London, was jailed for two years in March 2012 after admitting 13 counts of benefit fraud and three other counts of fraud relating to obtaining a national insurance number.
She has already been released on licence after serving less than half of her sentence.
David Jugnarain, prosecuting, said her fraud also included an application to the government for maternity pay, despite the fact she was already receiving it.
He said at the original court case: ‘The value of the fraud in this case is just in excess of £200,000 .’
In addition, she falsely claimed legal aid when she was sacked from the council, when they realised she working another job despite the fact she was signed off sick.
Popoola has now - after all this time, she was jailed 14 months ago - been ordered to repay a total of £304,079, including £186,000 compensation to Westminster City Council and HMRC, within six months.
The cash will be taken from her assets which are holed up in her three UK properties.
3 May 2013
Huge social housing fraud in Westminster
According to the government, fraud makes up only a small percentage of the annual housing benefit bill. Yet evidence collected in MPs’ own backyard has led the politician charged with tackling the problem in Westminster to claim it is ‘out of control’, reports Inside Housing.
The scale of fraudulent claims uncovered during an investigation by the DWP and Westminster Council was such that the Serious Organised Crime Agency issued an alert in December to warn local authorities of coordinated abuse.
Now the DWP is providing fraud specialists to help Westminster analyse data relating to 600 claims for housing benefit. The 12,000-home authority believes this will uncover ‘a significant number’ of fraudulent claims.
So, what is happening in the London borough, what can other councils learn from its experiences?
The DWP estimates that 1.5% (£350 million) of the £22.8 billion expenditure on housing benefit was claimed fraudulently during 2011/12. In Conservative-led Westminster - a prime target for fraudsters due to its high property values - it is a much more dramatic story. In some blocks in the borough, where £220 million is allocated annually to support private and social rent, the rate of overpayment of housing benefit has been as high as 95%. Investigators in Westminster estimate the overall housing benefit overpayment rate due to fraud is 10%.
So that would be £22m in one borough alone.
The borough has 26,000 housing benefit claimants and receives approximately 2,000 referrals of suspected fraudulent claims every year. There are currently 340 live housing benefit investigations, which cost the council more than £880 each to pursue. In 2012/13, the council investigated 500 claims and discovered £900,000 in fraudulent housing benefit payments.
An investigation which launched in 2010 found organised criminals were behind a multi-million pound fraud in the borough. Westminster partnered with the DWP on the back of residents’ concerns to investigate the abuse of housing benefit fraudulently obtained to fund private properties in the Edgware Road area for illegal sub-letting.
With support from the UK Border Agency and the local Safer Neighbourhoods team, raids on seven targeted blocks between July 2011 and February 2012 revealed a rate of between 61% and 95% of visited tenancies being illegally sub-let. As a result, the council was able to cancel £1.1 million of housing benefit claims and the authority says it has ‘numerous investigations ongoing with three people on police bail and one prosecution going through the court system’.
The investigation led SOCA to issue a warning to all local authorities, seen by Inside Housing, about the abuse, which centred on a group of 50 Iraqi nationals - some of whom had entered the UK on Danish and Dutch passports - making claims for disability living allowance and housing benefit. SOCA believes that, in some cases, ‘corrupt professionals [including complicit lettings agents] may have facilitated the criminal activity’.
As apparent EU citizens, fraudsters were able to pass the ‘habitual residence test’ designed to stop non-EU nationals arriving in the UK and immediately claiming benefits. European Economic Area passport holders were receiving housing benefit while claiming to work up to 16 hours a week, excluding them from DWP means testing or the attention of HMRC for income tax or national insurance. The loophole aided the establishment of a fictitious company with approximately 50 ‘employees’. Once the residents had fraudulently claimed housing benefit, some were then illegally sub-letting their properties.
Lindsey Hall, a Conservative councillor at Westminster and the authority’s anti-fraud ‘czar’, says that while the ‘really shocking’ rate of sub-letting uncovered in the raids might not be representative across the board, it has ‘flagged up some real holes in the system’.
This month, illegal sub-letting will become a criminal offence under the Prevention of Social Housing Fraud Act. So, what lessons can the extreme experiences in Westminster offer other councils?
Ms Hall believes councillors can ‘act as the conduit from the coalface up to law makers and decision makers’:
SOCA suggests local authorities should explore better methods of sharing information to identify where individuals are submitting fraudulent housing benefit claims in multiple areas. Similarly, the LGA is launching three pilot programmes with seven local authorities to show how sharing data between councils, housing associations and third parties can help develop new ways of catching tenancy cheats, and calling for councils to be given greater access to data from organisations such as utility companies and banks to better uncover tenancy fraud.
The government says the introduction of universal credit, which rolls a number of benefits including housing benefit into a single monthly payment from October, will reduce benefit fraud as the simpler system will calculate benefit levels using real-time information linked to PAYE and pick up financial irregularities. A new IT system automatically informs local authorities of new claims or changes in benefits and tax credits.
As part of the reforms, the government is also launching a Single Fraud Investigation Service, currently being piloted in Glasgow, Corby, Wrexham and Hillingdon. The service will take over from local authorities in investigating housing benefit fraud in 2014/15.
Ms Hall thinks it will work. ‘However, it cannot operate without local knowledge,’ she stresses, no doubt hoping the other politicians in Westminster are taking note.
In the past, tenants who fraudulently sub-let their social homes faced little more than losing their tenancy if caught. However, the Prevention of Social Housing Fraud Act, which is due to come into force this summer, makes sub-letting a criminal offence in England and Wales with perpetrators facing a fine and imprisonment of up to two years.
Housing providers will be able to recover the proceeds of illegally sub-let homes. The Audit Commission estimates nearly 98,000 social homes in England could be subject to some form of tenancy fraud. Fraudsters living elsewhere and renting out their social homes for profit cost the taxpayer as much as £900 million a year, the National Fraud Authority estimates.
The government has allocated a £9.5 million pot of cash to councils - including Westminster which received £200,000 - to help tackle illegal sub-letting of social housing.
The scale of fraudulent claims uncovered during an investigation by the DWP and Westminster Council was such that the Serious Organised Crime Agency issued an alert in December to warn local authorities of coordinated abuse.
Now the DWP is providing fraud specialists to help Westminster analyse data relating to 600 claims for housing benefit. The 12,000-home authority believes this will uncover ‘a significant number’ of fraudulent claims.
So, what is happening in the London borough, what can other councils learn from its experiences?
The DWP estimates that 1.5% (£350 million) of the £22.8 billion expenditure on housing benefit was claimed fraudulently during 2011/12. In Conservative-led Westminster - a prime target for fraudsters due to its high property values - it is a much more dramatic story. In some blocks in the borough, where £220 million is allocated annually to support private and social rent, the rate of overpayment of housing benefit has been as high as 95%. Investigators in Westminster estimate the overall housing benefit overpayment rate due to fraud is 10%.
So that would be £22m in one borough alone.
The borough has 26,000 housing benefit claimants and receives approximately 2,000 referrals of suspected fraudulent claims every year. There are currently 340 live housing benefit investigations, which cost the council more than £880 each to pursue. In 2012/13, the council investigated 500 claims and discovered £900,000 in fraudulent housing benefit payments.
An investigation which launched in 2010 found organised criminals were behind a multi-million pound fraud in the borough. Westminster partnered with the DWP on the back of residents’ concerns to investigate the abuse of housing benefit fraudulently obtained to fund private properties in the Edgware Road area for illegal sub-letting.
With support from the UK Border Agency and the local Safer Neighbourhoods team, raids on seven targeted blocks between July 2011 and February 2012 revealed a rate of between 61% and 95% of visited tenancies being illegally sub-let. As a result, the council was able to cancel £1.1 million of housing benefit claims and the authority says it has ‘numerous investigations ongoing with three people on police bail and one prosecution going through the court system’.
The investigation led SOCA to issue a warning to all local authorities, seen by Inside Housing, about the abuse, which centred on a group of 50 Iraqi nationals - some of whom had entered the UK on Danish and Dutch passports - making claims for disability living allowance and housing benefit. SOCA believes that, in some cases, ‘corrupt professionals [including complicit lettings agents] may have facilitated the criminal activity’.
As apparent EU citizens, fraudsters were able to pass the ‘habitual residence test’ designed to stop non-EU nationals arriving in the UK and immediately claiming benefits. European Economic Area passport holders were receiving housing benefit while claiming to work up to 16 hours a week, excluding them from DWP means testing or the attention of HMRC for income tax or national insurance. The loophole aided the establishment of a fictitious company with approximately 50 ‘employees’. Once the residents had fraudulently claimed housing benefit, some were then illegally sub-letting their properties.
Lindsey Hall, a Conservative councillor at Westminster and the authority’s anti-fraud ‘czar’, says that while the ‘really shocking’ rate of sub-letting uncovered in the raids might not be representative across the board, it has ‘flagged up some real holes in the system’.
This month, illegal sub-letting will become a criminal offence under the Prevention of Social Housing Fraud Act. So, what lessons can the extreme experiences in Westminster offer other councils?
Ms Hall believes councillors can ‘act as the conduit from the coalface up to law makers and decision makers’:
I think what is happening all around the country is that fraud is just buried, no one wants to admit it’s going on and, because no one’s really taken hold of it, it’s grown to a point where it’s out of control.While the Local Government Association insists ‘fraud isn’t out of control’ it does acknowledge it needs to be clamped down on in larger urban areas. A spokesperson says councils are increasingly looking at measures like hiring special investigators.
SOCA suggests local authorities should explore better methods of sharing information to identify where individuals are submitting fraudulent housing benefit claims in multiple areas. Similarly, the LGA is launching three pilot programmes with seven local authorities to show how sharing data between councils, housing associations and third parties can help develop new ways of catching tenancy cheats, and calling for councils to be given greater access to data from organisations such as utility companies and banks to better uncover tenancy fraud.
The government says the introduction of universal credit, which rolls a number of benefits including housing benefit into a single monthly payment from October, will reduce benefit fraud as the simpler system will calculate benefit levels using real-time information linked to PAYE and pick up financial irregularities. A new IT system automatically informs local authorities of new claims or changes in benefits and tax credits.
As part of the reforms, the government is also launching a Single Fraud Investigation Service, currently being piloted in Glasgow, Corby, Wrexham and Hillingdon. The service will take over from local authorities in investigating housing benefit fraud in 2014/15.
Ms Hall thinks it will work. ‘However, it cannot operate without local knowledge,’ she stresses, no doubt hoping the other politicians in Westminster are taking note.
In the past, tenants who fraudulently sub-let their social homes faced little more than losing their tenancy if caught. However, the Prevention of Social Housing Fraud Act, which is due to come into force this summer, makes sub-letting a criminal offence in England and Wales with perpetrators facing a fine and imprisonment of up to two years.
Housing providers will be able to recover the proceeds of illegally sub-let homes. The Audit Commission estimates nearly 98,000 social homes in England could be subject to some form of tenancy fraud. Fraudsters living elsewhere and renting out their social homes for profit cost the taxpayer as much as £900 million a year, the National Fraud Authority estimates.
The government has allocated a £9.5 million pot of cash to councils - including Westminster which received £200,000 - to help tackle illegal sub-letting of social housing.
Benefit claimant had £122k in the bank
A 65 year man from Whitley has been sentenced to six months in custody, suspended for two years, after being found guilty of benefit fraud.
Roy Edward Watt had been falsely claiming £16,261 of housing benefit and council tax benefit from Reading Borough Council between December 2010 and April 2012. On January 12, 2011, he also made a false claim for pension credits in a call to the Department for Work and Pensions.
Following a joint investigation by the DWP and Reading Borough Council, information obtained from Mr Watt’s bank statements showed he had a balance in excess of £122,000 at the time of making the claims. He had stated in benefits application forms that he only had £200 in the bank.
Mr Watt pleaded guilty to three charges involving false representations made to the Council and DWP and was sentenced at Reading Magistrates’ Court. Not only did he receive a suspended custodial sentence, but was also told by magistrates to do 200 hours of unpaid work and ordered to pay compensation (Reading Borough Council) of £5,000.
The court also ordered he pay legal costs of £969.62.
Jo Lovelock, leader of Reading Borough Council, said: “The Council takes all incidents of benefit fraud extremely seriously and has a good working relationship with other agencies such as DWP to ensure those guilty of fraud are caught and brought to justice. If anyone suspects anyone of receiving benefits they are not entitled, they should contact the Council.”
People caught cheating the benefits system can be fined up to £5,000 and be given a maximum sentence of six months imprisonment or both (in magistrates' court).
If the case if referred to Crown Court, the penalties are more severe, where the maximum penalty is an unlimited fine or up to seven years imprisonment or both.
In addition to the fines and sentences imposed by the court, all of these residents will be required to repay the benefits falsely received.
Arrangements will be made between residents and the Council to recover the overpayment of benefit.
Roy Edward Watt had been falsely claiming £16,261 of housing benefit and council tax benefit from Reading Borough Council between December 2010 and April 2012. On January 12, 2011, he also made a false claim for pension credits in a call to the Department for Work and Pensions.
Following a joint investigation by the DWP and Reading Borough Council, information obtained from Mr Watt’s bank statements showed he had a balance in excess of £122,000 at the time of making the claims. He had stated in benefits application forms that he only had £200 in the bank.
Mr Watt pleaded guilty to three charges involving false representations made to the Council and DWP and was sentenced at Reading Magistrates’ Court. Not only did he receive a suspended custodial sentence, but was also told by magistrates to do 200 hours of unpaid work and ordered to pay compensation (Reading Borough Council) of £5,000.
The court also ordered he pay legal costs of £969.62.
Jo Lovelock, leader of Reading Borough Council, said: “The Council takes all incidents of benefit fraud extremely seriously and has a good working relationship with other agencies such as DWP to ensure those guilty of fraud are caught and brought to justice. If anyone suspects anyone of receiving benefits they are not entitled, they should contact the Council.”
People caught cheating the benefits system can be fined up to £5,000 and be given a maximum sentence of six months imprisonment or both (in magistrates' court).
If the case if referred to Crown Court, the penalties are more severe, where the maximum penalty is an unlimited fine or up to seven years imprisonment or both.
In addition to the fines and sentences imposed by the court, all of these residents will be required to repay the benefits falsely received.
Arrangements will be made between residents and the Council to recover the overpayment of benefit.
- Benefit thieves do it for the money. They should know they will have to pay back twice what they stole. They should not be eligible for any benefits until they have, and they should have to do some unpaid work every week until the debt to society is cleared.
That would be a deterrent.
A confiscation order should be made immediately. In a case like this the authorities should be able to take the money from his account immediately guilt is confirmed.
Hit them in the pocket!
Judge orders arrest of benefit fraud DWP pensioner
A Judge has ordered the arrest of a pensioner who falsely claimed £46,000 in benefits – but has repeatedly failed to attend court.
Kim Smith, aged 57, was due for sentence at Plymouth Crown Court.
Smith's case had been adjourned five times before for various medical reasons.
But his barrister, Jason Beal (who's paying for all these appearances?), said that Smith's solicitor had not heard from him since the last hearing.
Judge Paul Darlow issued a bench warrant, meaning Smith must surrender to custody or he will be arrested and brought to court.
Smith, of Windsor, St Martin's, Looe, admitted back in October three charges of dishonestly failing to notify a change of circumstances over six years. He was wrongly paid incapacity benefit, income support and council tax relief.
He did not inform the authorities of a pension from the Department for Work and Pensions – the very body which is prosecuting him. Databases not communicating even within the department!
Smith also faces proceedings to seize assets as the proceeds of crime.
The court heard previously that Smith was suffering from problems including asthma and depression.
Kim Smith, aged 57, was due for sentence at Plymouth Crown Court.
Smith's case had been adjourned five times before for various medical reasons.
But his barrister, Jason Beal (who's paying for all these appearances?), said that Smith's solicitor had not heard from him since the last hearing.
Judge Paul Darlow issued a bench warrant, meaning Smith must surrender to custody or he will be arrested and brought to court.
Smith, of Windsor, St Martin's, Looe, admitted back in October three charges of dishonestly failing to notify a change of circumstances over six years. He was wrongly paid incapacity benefit, income support and council tax relief.
He did not inform the authorities of a pension from the Department for Work and Pensions – the very body which is prosecuting him. Databases not communicating even within the department!
Smith also faces proceedings to seize assets as the proceeds of crime.
The court heard previously that Smith was suffering from problems including asthma and depression.
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