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28 Oct 2019

How Birmingham is tackling social housing frauds

This explores behind the recent revelation that sixty-four Birmingham homes had been recovered in a crackdown on housing fraud.

Amidst a housing crisis in the city with 13,000 people on the waiting list including around 3,000 families in temporary accommodation, every single home has become an extremely precious commodity. So it is scandalous that scores of perfectly good council houses are being abused every year - some just abandoned, while others are utilised for criminal enterprises such as cannabis farms.

But since 2010 the city council has ploughed significant investment into tackling the issue, with investigators using everything from light bulbs to library cards to detect fraud.

"It's always been there," said Neil Farquharson group auditor at the council, "But we have become more and more sophisticated and put more resources into tackling the problem.

"We realised how valuable a council property is, the amount of people we have got in temporary accommodation is growing and growing, therefore the more effort we can put into recovering properties and stopping people getting tenancies fraudulently, the better. Is it getting worse? It's difficult to say, but the housing crisis in the city is only going to exacerbate the problem."

In the past, illegal sub-letting grabbed the headlines being a major problem in London where property prices are notoriously high. It also prompted the Prevention of Social Housing Fraud Act in 2013. But that issue is 'rare' in the second-city where 'non-residency' is the most common type of housing fraud. This can often occur when people meet new partners and spend time living with them instead, or maybe move to a different part of the city or country for work.

Typically, tenants will also be in receipt of housing benefit which means they can stay away knowing their rent is covered. Is it naivety or an intentional abuse of the system?

"It's a mixture of both," said Mr Farquharson, "A lot of the cases we get are because a person's personal life has changed. There is a degree of naivety but also some people fully know what is expected of them and they will go ahead anyway."

Right to Buy, the government scheme which gives council tenants of three years or more significant discounts off the purchase price of a home, has also created an 'incentive' to obtain a council property. It has driven fraudulent housing applications whereby people may lie about the make-up of their household, falsely claiming there are six people living in a one-bedroom flat when there are only two, for instance.

Then there are the fraudulent housing applications themselves, when people will purport to have less than the £16,000 capital threshold which would render them ineligible. At the more extreme end of the scale, homes have been completely abused and used to grow drugs on an industrial scale.

"You will get cannabis farms that's one of the problems, that has been the case in Birmingham," Mr Farquharson lamented.

So how does the council go about tackling the problem? Partly, there is a reliance on tenant's neighbours reporting suspected misuse of a property. But over the years the authority has also developed a 'pioneering' anti-fraud data warehouse. It is essentially a mega-system which captures all of the data across the council to 'get a picture of a person' including council tax records, benefits records, licensing records and even library card forms.

"If we look at a housing application and somebody says they are living at an address in a particular part of the city we can say 'well actually according to your library card you don't live at that address, and according to your benefit records there's another inconsistency' so straight away it identifies anomalies," Mr Faquharson said.

It has become an incredibly efficient tool allowing for 'real-time matching' of information within 24 hours of a new housing application. The task then is for investigators to build up enough evidence to reclaim a property, which can take anywhere between three to 18 months.

Mr Farquharson said: "We speak to neighbours and say we haven't seen that person in the property for a long time. We have also got the power to request utility providers to tell us how much gas and electricity a person has used in a given period.

"We use industry averages as well, and can say 'your usage suggests you have had one light bulb on for the last two years, don't you put the heating on, the cooker on, the television on? So we build a case of evidence."

In some cases, the information is sufficient to cancel housing benefits and the prospect of a backdated bill is enough to cause tenants to surrender the keys without fuss. In other instances they may fight it.

Figures suggest that the fraud team is now getting ahead of the problem. While the number of homes being recovered is declining from 87 in 2017/18 to 64 last year, and just shy of 30 so far this year, the amount of cancelled applications is going in the other direction. There were 152 applications stopped before letting in 2017/18, increasing to 212 last year, while there have been more than 400 already in the current financial year.

High-profile results over the years, have also helped highlight the issue of housing fraud. Among them was Sonia Hunter who was awarded a 70 per cent discount on her Right to Buy purchase of 45 Attenborough Close, but failed to declare that she owned a home in Court Lane, Erdington. In 2014 she was given a 10-week prison sentence suspended for 18 months, and ordered to pay the council £23,545 through the the Proceeds of Crime Act (POCA).

In the same year concerns were raised about senior council housing officer Zara Danyaal, from Acocks Green. An investigation established she used fake identities and personal information to submit and process six fraudulent housing applications between 2011 and 2013.

Danyaal was jailed in June 2016 for three years - 30 months for one count of housing fraud and six months for two offences relating to job references. She was also ordered to repay £20,000. Her other Samara Malik, who was not employed by the council but awarded one of tenancies, was sentenced to ten months for one count of housing fraud after supplying false information.

Then there was Mbarak Awdah Abdallah who was sentenced to 16 months imprisonment - having already been jailed for another offence - and ordered to repay £18,990.30. He had gained the tenancy of 4 Milston Close in Druids Heath, after claiming a 'landlord' had ordered him to vacate his home at 191 Chinn Brook Road, Yardley Wood - a property, which it transpired Abdallah owned himself and had been renting out.

"If you are committing housing fraud we are getting more and more sophisticated with our detection methods, we will find you and there is legislation there that means we can prosecute you," said Mr Farquharson.

"To the members of the public, social housing fraud isn't something we should tolerate, we shouldn't be denying people who genuinely deserve social housing. If you believe somebody isn't using their property as their sole main residence, you should report it."

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