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Beware of Benefit Fraud Investigations – DWP Wising Up After Stopping £1 billion Scam

Beware of Benefit Fraud Investigations – DWP Wising Up After Stopping £1 billion Scam

Being accused of benefit fraud is an extremely serious offence. If the Department for Work and Pensions (DWP) thinks that you have fraudulently received benefits and tax credits, you could face criminal prosecution, a lengthy prison sentence, and proceedings to confiscate your money under the Proceeds of Crime Act 2002.

Benefit fraud has become a problem for the DWP during the Covid-19 lockdown, with serious organised crime groups allegedly stealing thousands of identities to fraudulently claim Universal Credit.

In May 2020, a junior civil servant working with High Street banks noticed dozens of suspicious Universal Credit payments were all being paid into the same bank account. A further investigation uncovered more than 100,000 fraudulent claims. In total, it is thought that at least £1.5 billion has already been paid to organised crime gangs, although the DWP has prevented a further £1 billion from being transferred in recent months.

The DWP estimates it will need to check more than a million Universal Credit claims to check which ones are genuine, and it intends to pursue those which are not.

As a result of the investigations, there is also a risk that people who mistakenly claimed Universal Credit because of confusion caused by the coronavirus situation will be implicated in fraud accusations. For example, there are concerns that tens of thousands of people who claimed Universal Credit without declaring that they received government self-employed income support grants could be affected.

What is benefit fraud?

Broadly speaking, benefit fraud occurs when you claim benefits which you know you are not entitled to. Criminal offences relating to benefits claims are wide-ranging, from cases of dishonestly claiming benefits to failing to notify the DWP of certain events or changes in circumstances.

These crimes can be prosecuted under an array of laws, including the Fraud Act 2006, the Theft Act 1968, the Tax Credits Act 2002, the Social Security Administration Act 1992 and common law.

Benefit fraud could include:

  • Providing false or incorrect information about personal details or financial circumstances
  • Having more money than you declared (the 'capital limit')
  • Failing to report a change in circumstances

Benefit fraud can occur within the whole range of state benefit schemes including Universal Credit, disability allowances, pension credits and the Council Tax reduction Scheme.

What to do if you have been accused of benefit fraud

The Government and the DWP have always been extremely serious about clamping down on benefit fraud. So, whether you have been accused of a one-off infringement or you have been implicated in a widescale scam as part of criminal gang activity, prosecution should be taken very seriously. You can even be pursued for simply trying to commit benefit fraud, even if your attempt was unsuccessful.

If you are suspected of benefit fraud, you will first be contacted by the DWP, HMRC, your local authority or the Service and Personnel and Veterans Agency.

You may be invited to attend an interview under caution to answer questions about the alleged criminal offence. You have the right to legal advice during this interview.

Remember, whatever happens during this interview could be used as part of a criminal prosecution, so getting legal advice is essential, even if it is just a misunderstanding. Having a criminal defence solicitor who specialises in fraud by your side could mean the difference between the investigation being dropped and a full-blown criminal prosecution.

If there is sufficient evidence to prosecute, you may be taken to court. Benefit fraud proceedings can either happen in the Magistrates Court or the Crown Court, depending on the seriousness of the offence.

What are the penalties for benefit fraud?

The criminal penalties for benefit fraud can include:

  • A criminal record
  • A fine - this can be unlimited if prosecuted in the Crown Court
  • A prison sentence - the length will depend on the seriousness of the crime, the offenders' culpability (blameworthiness) and the level of financial gain. For example, the crime of conspiracy to defraud carries a maximum sentence of 10 years in prison
  • Proceedings under the Proceeds of Crime Act 2002 to freeze and/or confiscate your assets

The authorities do not always take criminal legal action against suspected perpetrators of benefit fraud - they may take 'administrative' action instead. Administrative cautions and penalties can also be serious, but do not leave you with a criminal record which can have an impact on your future job opportunities.

Administrative penalties include:

  • Being ordered to repay overpaid benefits
  • Being ordered to pay a penalty of between £350 and £5,000
  • Having your benefits stopped for up to 3 years

You can also be given an administrative caution, which is a formal warning that stays on record for five years.

Get specialist advice about benefit fraud from our criminal defence solicitors

If you are suspected of benefit fraud, do not leave the outcome to chance. Our expert serious fraud solicitors can provide clear, practical advice about your options and represent you during interviews, investigations and at court.

We will ensure that your legal rights are respected and protected at every step, giving you the best possible chance of a positive outcome. With our assistance, our clients are often able to avoid criminal prosecution altogether, either by getting the investigation dropped or by negotiating lower penalties.

So, if you need advice on a benefit fraud case, or any other serious fraud issue, get in touch with our expert serious fraud lawyers for guidance and legal representation.

Contact us today in West Drayton on 01895 449288, in St. Albans on 01727 840900 or send us an email.

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