30 Sep 2014

Asylum seekers sub-let London flats

Former Iraqi asylum seekers have been raking in millions of pounds by illegally sub-letting luxury London flats paid for by taxpayers.

The housing benefit claimants have been funded by the state to stay in lavish apartments in some of the capital’s wealthiest addresses. But rather than living there, the claimants have been renting them out to super-rich tourists for thousands of pounds a week.

In one case, a family of six – who cannot be named for legal reasons – were being given £500 a week housing benefit to live in a £1 million flat near Hyde Park, which they then let out for up to £3,000 a week.

Last week investigators swooped on 21 benefits cheats – the majority of whom were identified as Iraqi Kurds – at four expensive apartment blocks. They included Forest Court, a grand, nine-storey 1930s mansion building, and the Art Deco development Park West, both less than half a mile from Marble Arch. Properties in both blocks come with 24-hour security, manicured lawns and concierges.

It is estimated the fraudsters have made more than £100,000 each by sub-letting the flats over a three-year period, while costing the taxpayer a quarter of a million pounds in housing benefit. Hany Hanna, an estate agent in Marylebone, said he had been aware of the scams for 20 years, but recently they had reached ‘epidemic’ levels:
They come into my office asking which blocks are best to rent. Some of them will come to the UK with a piece of paper with instructions on how to do things. First you have to be pregnant, then go to the housing department – they give you a flat. After you get the flat, you move into another place, give the [first set of] keys to an agent, he will find you a tenant and you’ll be making double whammy – money from the Government and making money from the flat the Government gave you.
Westminster Council’s anti-fraud tsar, Councillor Lindsey Hall, said many of the families were former asylum seekers who had been granted refugee status. They receive up to £500 a week in housing benefit which they use to rent private flats in luxury blocks. They secure these tenancies through unscrupulous middlemen acting as estate agents, before moving into a cheaper flat.

They illegally sub-let the more expensive taxpayer-funded apartment to wealthy Arab families holidaying in London from Gulf states such as Saudi Arabia. The Iraqi-born claimants and the crooked agents split the profits. The frauds are committed without the knowledge of the property owners, who receive the rent they are charging without realising their home is being let for much more.

The 21 fraudulent benefits claimants Westminster recently apprehended have all had their housing benefit payments cancelled and face civil court proceedings to reclaim the money. But Ms Hall said it would be difficult to bring criminal prosecutions in most cases because of the high burden of proof councils need, which can be very costly:
We are asking for a more rigorous system where the onus isn’t always on local authorities to spend tens of thousands of pounds and conduct months of work to prove that someone is claiming benefits fraudulently. Tougher tenancy agreements would be a starting point, and a fully traceable, fully transparent money trail ahead of that agreement being put in place. We need same rigour as in the private sector.

29 Sep 2014

DWP declines offer to use CIFAS database

"Bungling Bedroom Tax minister Lord Freud" is now being accused of failing to weed out benefit cheats, says The Mirror. And that could cost the taxpayer up to £2 billion in stolen handouts.

The Welfare Reform minister has snubbed a data matching offer from the UK Fraud Service, Cifas, to identify fraudsters claiming benefits.

That means their cheating will be imported into the new Universal Credit he designed. UC will roll most benefits into one by 2017.

Lord Freud was first asked in October, 2013 if he’d like to cross match benefit claimants against the Cifas database to see if they had a history of fraud. Cifas chief executive Simon Dukes said:
We’ve offered DWP the opportunity to check their books and help to identify benefit fraudsters before they get moved over to Universal Credit. The offer is at no cost to them, and no gain to us. I find it extraordinary that they have not taken it up.
Fraud costs Whitehall £56billion a year - most of it through tax dodging, false benefit claims and pension cheating, the equivalent of £2,500 for every family in Britain.

But it is likely to be more than twice that because only 40 per cent of fraud is detected.

The data matching Cifas is willing to put at Lord Freud’s disposal could uncover much of that. It is within the law to share data to prevent public sector fraud.

Mr Dukes added: “There are benefit claims for people who don’t exist because they’re dead. Fraudsters steal their identity, or families keep drawing pensions for dead relatives.”

Cifas collects the names of the 11,000 people who die in Britain each week.

The Home Office already shares data with Cifas to keep tabs on illegal immigrants. And the material Cifas gathers goes to the City of London Police National Fraud Intelligence Bureau.

Cifas is a not-for-profit service funded by businesses who join up. Mr Dukes says for every £1 spent £200 is saved. And he added: “If you can identify fraud in one place you can stop it occurring elsewhere.”

A DWP spokeswoman said: “We are already working across government to bring in our own counter-fraud database. Universal Credit is expected to further reduce losses by £1billion.”

The government claims losses from benefit fraud are only just over £1 billion now.

26 Sep 2014

Repeat benefit fraudster jailed

A Coulsdon man has been sentenced to two and a half years after being convicted of multiple charges of dishonesty and one of money laundering in relation to his claims for Council Tax Benefit, Job Seekers Allowance and Pension Credit. (h/t Active Follower) The prosecution followed an in-depth investigation by Reigate & Banstead Borough Council.

Michael Peter O’Brien of Brighton Road, Coulsdon failed to declare ownership of three properties and the income he received from them to officers at Reigate & Banstead Borough Council and the Department of Work and Pensions (DWP). Between 2003 and 2011 he claimed £14,668 of Council Tax Benefit from Reigate & Banstead and was overpaid £106,232 of Job Seekers Allowance and Pension Credit from the DWP. He also failed to declare bank accounts he held with HSBC.

"The sentence of two and a half years in custody reflects the seriousness of this case of fraud and money laundering," said Cllr Rita Renton, Reigate & Banstead’s executive member for housing and welfare. She continued: "Our officers fought hard to ensure Mr O’Brien was brought to court to answer the allegations, despite several attempts by him to delay court proceedings. Fraud costs local tax payers tens of thousands of pounds, diverting public funds away from those who need it; directly affecting our communities. It is only right that people who commit such crimes should be held to account and we work hard to investigate where we suspect fraud and to recover money claimed fraudulently."

Mr O’Brien is required to repay the overpayments in full. The council is now seeking to confiscate his assets under the Proceeds of Crime Act to recover the money. The hearing is scheduled for December.

He was convicted of six counts of dishonesty under the Social Security Administration Act 1992 covering false representations to Reigate & Banstead Borough Council and the Department of Work and Pensions. He was also convicted of one charge of money laundering under the Proceeds of Crime Act 2002 covering the conversion of criminal property (the proceeds of criminal conduct). As well as his home in Coulsdon, Mr O’Brien owns a second property in Brighton Road, Coulsdon. He previously owned a further property in Purley, Surrey and another in Gillingham, Kent, both of which he sold prior to the start of the investigation.

Mr O’Brien cancelled his claims for benefits from the DWP and Reigate & Banstead Borough Council in 2011 when he became aware of the investigation. He has previous convictions dating back to 1990 for benefit fraud.


25 Sep 2014

Benefit thief will need 41 years to pay back £103k

Benefit cheat Donna Osborne pocketed £103,441 in a seven-year swindle – after claiming she lived alone.

The 50-year-old was raking in £265 a week in handouts after telling the authorities she was an unemployed single mum. But the fraudster later started living with her partner and managed to claim the benefits from 2004 to 2011. Now Osborne of Fegg Hayes, has started repaying the cash – at a rate of just £45 a week.

She has been spared jail at Stoke-on-Trent Crown Court to allow her to care for her disabled son.

The prosecution comes as Stoke-on-Trent City Council revealed it has investigated frauds totalling £1.2 million in the past 12 months.

City councillor Alastair Watson, cabinet member for finance, said: “This is one of our largest benefit fraud cases. We will not tolerate those who abuse the system and swindle honest, hard-working taxpayers.”

The 50-year-old had made arrangements for her disabled son’s care after fearing she would be jailed for her £103,441 benefits swindle. But Recorder Christopher Goodchild took into account Osborne’s poor health and the fact her son would be ‘lost without her’. Instead he handed Osborne a suspended prison sentence.

Stoke-on-Trent Crown Court heard the defendant started legitimately claiming income support, housing benefit and council tax benefit in 1997 as an unemployed lone parent. But in 2004 her partner moved in and she repeatedly failed to tell the Department for Works and Pensions (DWP) about the change and was overpaid £103,441 over the next seven years.

The court heard Osborne has £97,000 left to repay at a rate of £45 a week.

It emerged that if Osborne had been honest she would still have been eligible for £230 a week in other benefits. She was sentenced to 36 weeks in prison, suspended for two years.


24 Sep 2014

No jail for £61k benefits fraud mother

A benefits cheat has avoided jail after she admitted stealing more than £60,000 from the public purse. (h/t Dave)

Mother of two Amanda Finlay, from Saughall, Chester, repeatedly lied about her circumstances for six years to obtain a string of housing, council tax and other benefits which she used to pay off her debts, Chester Crown Court heard.

Finlay carried out her fraudulent council tax, income support, housing benefit and tax credits claims under her maiden name of Heritage while living with husband-to-be Kevin Finlay.

While claiming to be a single parent living alone, Finlay received more than £25,000 in housing benefit and more than £21,000 in tax credits. She also received income support with the total sum claimed put at £61,284, said Simon Berkason, prosecuting.

The claims were made over a five to six-year period, starting towards the end of June and beginning of July 2007 until February of last year. Benefits investigators then became suspicious and interviewed Finlay, who immediately owned up to her wrongdoing.

Finlay, who wept in the dock, pleaded guilty to three counts of fraud and to one count of being knowingly concerned in fraudulent activity. Mr Berkason told the court: “There were multiple frauds and there were multiple occasions when this could have been put right by the defendant.”

Robin Boag, defending, said Finlay’s actions were not carried out with “cold blooded intent” and pleaded against a prison sentence being imposed. “This is a lady who has no previous convictions,” he said. “She is remorseful for her actions but it is not a case in which she has enjoyed a luxurious lifestyle, or in which she has been enjoying exotic holidays, or is in posession of fancy motor cars,” added Mr Boag, who said Finlay had used the money to settle debts.

Finlay was sentenced to eight months in prison, suspended for two years, by Judge Raj Shetty, who told her:
The amount of monies you fraudulently claimed was quite staggering. I am satisfied that if you had not have been stopped and caught you would have carried on. You have told the court that you used the monies because you were in debt. My reaction to that is ‘so what?’. Many other hardworking people have to work hard to make ends meet and by doing what you did you took from the needy. You took those benefits to make your life easy.

Finlay was also ordered to wear an electronic tag with a curfew for 12 months and must pay £85 costs.

23 Sep 2014

Wigan council reports benefit fraud totals

Almost 300 households receiving benefits were referred to Wigan Council as potentially being fraudulent claimants last year.

Local authority officers recovered £578,000 for the public purse as a result of prosecutions for false housing benefit, council tax benefit and income support claims.

Of the 285 referrals last year, 186 were proven as fraud with 20 referred for prosecution. All of the 20 that ended up in court ended in prosecution with the other cases dealt with by a caution or financial penalty.

The previous year a total of 45 cases were referred for prosecution with a total of £690,000 recovered during that 12 months. Wigan Council said the drop in the number of referred cases was due to a policy change.

A spokesman said: “Each case of proven fraud is assessed against a number of factors to determine whether it is appropriate to prosecute. As an alternative to prosecution, offenders may be offered a caution or a penalty. For small value frauds, we will seek recovery of the money. So, while a lower number of cases were referred for prosecution in 2013/14 than the previous year, the value of fraud prosecuted was proportionally higher. This reflects our policy to target the biggest frauds. We will continue to investigate housing benefit fraud between now and February, when the government will take over full responsibility for this area.”

The Department for Work and Pensions will assume jurisdiction for housing benefit fraud investigations early next year. The two council officers who have recovered more than £1.2m over the last two years will be given new roles within the local authority.


22 Sep 2014

£19k disability fraud

A benefits cheat avoided jail despite being given £19,000 in disability handouts while working as an instructor sergeant for army cadets. (h/t a reader)

Father-of-five Brian Falcus, 38, of North Shields, Tyne and Wear, was given government help after claiming he had restricted mobility and needed help with personal care. But he was involved in parades two nights per week, educational weekends and annual camps and courses with young recruits at the army cadet corps.

Prosecutor Graeme O’Sullivan told Newcastle Crown Court that Falcus was paid disability living allowance from 2004 and employment support allowance from 2009. He added: ‘Evidence came to light that in August 2010 Mr Falcus had joined the army cadet corps as an instructor sergeant. He had been passed fit to do so on August 8, 2010.’

Mr O’Sullivan said the basis for Falcus’s award for benefits was ‘restricted mobility and help with personal care’. He added: ‘The prosecution case is, from 2010, his physical capability must have improved for him to be sufficiently fit.’

Mr O’Sullivan said the benefits would normally be given to wheelchair users, people with disabilities making it difficult for them to get around and those with illnesses that restrict their mobility. Falcus pleaded guilty to two charges of dishonestly failing to notify a change of circumstances.

Mr O’Sullivan added: ‘He accepts during the period he ought to have notified the department of an improvement in his circumstances.’

The court heard the army fitness test which allowed Falcus to be sergeant, a voluntary post with just expenses paid, would not have been as rigorous as those taken by soldiers who would be deployed on the front line. Mr O’Sullivan said: ‘His work involved parading two nights per week, educational weekends, annual camp and various courses.’

Judge John Milford sentenced Falcus to 14 weeks in jail, suspended for two years, with a three-month curfew from 8pm to 7am. The judge told him: ‘You have pleaded guilty to benefit fraud which has cost the British taxpayer £19,000. You were receiving two allowances, the most significant of which was disability living allowance and the other employment support allowance on the basis you were suffering from a significant disability, namely restricted mobility. The fact of the matter is, for three years over the period of this fraudulent claim, you were fit enough to be a sergeant instructor in the cadets and had you informed the department, as you should have done of that, no doubt the allowances would not have been paid.’

Nicholas Lane, defending, said Falcus is the father of five children, two of whom have extra needs. Mr Lane said Falcus got involved with the cadets when his doctor advised him to be more active. He added: ‘We are not talking about a man assessed as fit to take up a role on the front line. This is a gentleman who, on the army cadet force health guidelines, is assessed as being able to take part in supervision and other activities for boys and girls.’


17 Sep 2014

Watford man dispossessed for illegal sub-letting

A law introduced to Parliament by Richard Harrington, MP for Watford, has been used to penalise a man who attempted to illegally sublet a Watford Community Housing Trust property.

Edward Cawdron has been ordered to pay almost £11,000 after a District Judge found he had unlawfully profited from tenancy fraud in Raphael Drive.

Cawdron was not living at the house and was advertising it in an attempt to sublet the property, despite owing the trust more than £3,000 in rent arrears. He had taken several deposits.

The trust brought the prosecution after seeing the property advertised for rent.

The District Judge ordered Cawdron to give up possession of the property and pay the trust £10,716.54, including damages of £4,700 - the amount he was found to have collected in deposits from interested parties.

The damages award was made under the Prevention of Social Housing Fraud Act 2013, which makes tenancy fraud a criminal rather than a civil offence.

It is thought to be the first time the act has been used in Watford to recover illegal profits from tenancy fraud.

Tina Barnard, chief executive of Watford Community Housing Trust, said:
It’s disappointing to see someone trying to play the system in this way, but the positive thing to come out of this case is that it sends a powerful message that we are tracking down tenancy cheats. We are also delighted that we were successful in getting possession of this two-bedroom house, which will now be offered to a family in housing need in Watford.

Illegal sub-letting of social housing is a wicked crime. It's not just the (considerable amount of) money - people and families who need a home are being deprived of it.

16 Sep 2014

Haider Abbas claimed nearly £50k in benefit fraud

A Northolt man who claimed benefits while working as a driving instructor was given a suspended sentence after fraudulently claiming almost £50,000 over three and a half years. (h/t Dave)

Haider Abbas, 32, was investigated by Ealing Council after an anonymous tip-off revealed he was working as an instructor at London Elite Driving School and had been falsely claiming housing and council tax benefit since March 2010.

Abbas had taken almost 200 candidates for practical driving tests since 2009 while he claimed to be working only 16 hours a week as a secretary on the minimum wage.

He was sentenced at Harrow Crown Court after admitting two offences of dishonestly making a false representation and one charge of dishonestly failing to notify of a change in circumstances.

Abbas was given a six-month prison sentence, suspended for 12 months, and ordered to pay costs of £3,651.64. He was also put under a curfew for six months and will have to do 150 hours of unpaid work.

He claimed £44,129.40 housing benefit, £4,104.94 council tax benefit and £456.49 council tax support, which he will have to pay back to Ealing Council.


This was the result of a tip off. Otherwise, who knows how many more years this easy fraud would have lasted.

15 Sep 2014

Tip-off revealed £135k 5-year benefit frauds

A reader writes, "always start 'legitimate', then miracle cure. Of course, if they had not started working, this would probably never come to light".

A couple who claimed they were too ill to cook their own meals were actually running a café, while illegally pocketing £135,000 in benefits.

Caroline Banks and Karl Bradsell were jailed after deceitfully claiming cash from the state for five years, before a sting by council bosses and the DWP saw them brought to justice.

After a tip-off, an investigation was launched, with CCTV and secret footage proving their lies.

Banks, of Hills Court, Bury, was jailed for 16 months and Bradsell, of Chaffinch Drive, Bury, for 19 months at Bolton Crown Court. They pleaded guilty to 24 fraud charges at an earlier hearing.

The pair, who are no longer together, worked at Riscatti’s Café on Bury Market, despite claiming their illnesses were so bad that they couldn’t cook for themselves, and that one of them couldn’t even walk.

Peter Cadwallader, prosecuting, told the court Banks, 42, said she was unable to walk unaided, needed a wheelchair and had to get help to go to the toilet. She claimed to have a long list of illnesses, including a slipped disc in her back, angina and depression. Her home had been adapted with a stairlift and a wet room while she was claiming Disability Living Allowance, Employment Support and Housing Benefit, among others. She also had a mobility car so friends and family could drive her around. But Banks, who sobbed throughout the hearing, was filmed working long days on her feet, lifting tables and chairs and serving customers at the café. On one occasion, she was even spotted wearing high heels.

Defending Banks, Stuart Duke said her initial benefit claims had been legitimate, but that the situation spiralled into ‘dishonesty and deceit’. She was overpaid £62,000 and will pay back the cash from her benefits. Mr Duke said: “Ironically, since these offences came to light, both her physical and mental health have deteriorated. She has fallen into abject poverty and is unable to walk.”

But as the picture shows, she can still smoke standing up.

Bradsell, also 42, said he rented the council house next door to Banks and was single. In truth, he lived with Banks in her adapted home while he sub-let his house to his brother. He claimed to suffer from epilepsy and depression and said he hadn’t worked since 2005, when questioned in 2012. He said his condition was so bad that he had fits every couple of days and suffered panic attacks, often wetting himself. He said he couldn’t drive because of his epilepsy and that he used a microwave because he was afraid of using the cooker. But he was filmed driving Banks’ mobility car to and from the cafe, where he cooked and cleaned. He even used the vehicle to deliver food for a local Chinese takeaway at night.

Defending Bradsell, Michael Lea said he accepted he had exaggerated to claim benefits. He now has a job helping older people and is paying back around £140 a week out of his wages to refund the £73,000 he fraudulently claimed.

Sentencing, Judge Elliot Knopf said the pair’s crimes were a ‘slap in the face to the taxpayer’ and those ‘genuinely and honestly entitled to benefits’:
You put your heads together and agreed to consciously, deliberately and persistently defraud the system. You painted a completely and utterly false picture of your conditions - you knew the buttons to press.
After the hearing, Coun Sandra Walmsley, Bury council’s cabinet member for resource and regulation, said: “This was a deliberate and breathtaking act of fraud, carried out over a long time and involving huge sums of money. Thanks to the determined efforts of our investigators, Bradsell and Banks have finally been brought to justice.”

Coun Sandra Walmsley probably lies. It seems they had no idea about the deception until they were tipped off.

How many more benefit frauds is Coun Sandra Walmsley unaware of?