What Might Constitute a Fraud
The benefit system relies on the honesty of our customers and despite a minority, most people can be found within this category. Bassetlaw District Council has an Investigation Unit to deter or stop them from entering the system, or to identify any benefit payments that are being made to people who should not be receiving them.
The Unit is made up of specially trained staff that investigates any suspected or alleged cases of fraud regarding Housing benefit or Council Tax Benefit. They work closely with the Department of Work and Pensions (DWP) involving cases or fraud with other state benefits such as Income Support, Jobseekers Allowance, Incapacity Benefit and Guarantee Pension Credit. The following might constitute a fraud...
- Housing Benefit/Council Tax Benefit fraud
Working and claiming fraud usually involves claimants who are in receipt of Housing Benefit/Council Tax Benefit on the basis of entitlement to Job Seekers Allowance/Income Support, but who are in fact working. Or maybe, they have not told us the true extent of their work or wages.
- Non-disclosure of property/capital
This fraud is where a claimant fails to declare either savings/capital or the ownership of another property/land elsewhere (for which they may be receiving rent or may have recently Sold).
- Non-disclosure of income
This is where the claimant fails to declare all of their income, knowing or intending that non-declaration will increase their benefit award.
- Non-disclosure of partner (living together as husband and wife)
This fraud usually involves a claimant on Benefit who fails to declare the presence of a partner who maybe working or not, knowing or intending that this would affect their entitlement.
- Non-declaration of non-dependants and/or sub-tenants
It is fraudulent if a claimant fails to declare the presence of other adults living in the property, in order to preserve or increase entitlement to benefit.
- False claims by homeowners
This is where the owner of a property falsely states that he or she is paying rent to occupy what is, in fact, his or her own property, usually inventing a fictitious landlord to do so.
- Failing to declare change of address
Where a claimant fails to declare that he/she has moved, but continues to accept payments of Housing Benefit for their previous address, they are committing a fraud.
- False address fraud
This fraud may occur where a person is claiming for an address at which he or she is not in fact living. This type of offence may occur with the collusion of the landlord or other tenants.
- Landlord fraud
This is where a landlord continues to receive benefit paid directly to him/her for a period after which he/she is aware that the claimant has vacated the premises. Where the landlord has access to more than one property, there is the potential to move tenants around without informing the Local Authority.
The Legal framework
The Social Security Administration (Fraud) Act 1992 places a statutory obligation upon Local Authorities to investigate and detect all allegations of fraud within the Council Tax and Housing Benefit System. Benefit Fraud Investigators must work within the law examples of which are:
- The Police and Criminal evidence Act 1984 (PACE)
- The Criminal Procedure and Investigations Act 1996 (CPIA)
- The Regulation of Investigatory Powers Act 2000 (RIPA)
- The Human Rights Act 1998
- Data Protection 1998
- Social Security Administration (Fraud) Act 1997
- Social Security Fraud Act 2001
- The Theft (Amendment) Act 1996
- The Fraud Act 2006
There are a number of sanctions available to impose on a claimant who has committed a benefit offence.
- Recovery Action
In some cases an investigation may uncover an overpayment but it is not appropriate to take criminal action, however the overpayment will be recovered in full.
- Administrative Penalty
This is offered as an alternative to prosecution in cases where an investigation has been undertaken and the Council believes that sufficient evidence has been gathered to suggest an offence has been committed. The overpayment in addition to a fine, valued at 30% of the recoverable overpayment, must be repaid to the Council. In accepting the penalty the suspect is not admitting that he or she has committed an offence but if they refuse the Administration Penalty, they may be prosecuted.
- Local Authority Caution
These are similar to a Police caution and can also be offered as an alternative to prosecution. Before a caution can be issued the suspect must have been 'interviewed under caution' and he or she must have admitted that he or she has committed an offence. The Local Authority Caution does not give the suspect a criminal record but it can be cited in Court should (s)he be subsequently convicted of a Benefit Offence.
In cases where serious benefit fraud is suspected, Bassetlaw District Council will consider prosecution. These cases are normally heard in a Magistrate's Court but the more serious cases may be dealt with in a Crown Court.
Rights and Powers of the Investigator
Designated and properly trained investigators can seek information from contractors and the self employed under the Social Security Administration Act 1992, Section 110A and 109B & C. The Benefit Fraud Code of Practice sets out our rights and Powers as Investigators and the procedures we must follow.