What is benefit fraud?
Deliberately failing to report a change in your circumstances or being dishonest about information regarding your benefit claim is considered benefit fraud.
What different types of benefit fraud are there?
A benefit claimant commits fraud by failing to give the following information:
- their correct household income;
- their correct savings or capital;
- that a partner or other adults live with them;
- that they own other property or land;
- a change of their domicile address.
Fraud may also be committed by:
- pretending to rent a property, but actually owning it;
- pretending to pay more rent than in reality;
- a landlord not declaring that tenants have moved out, still accepting their benefit payments;
- requesting an employer sign a form declaring the claimant earn less than they actually do.
What are the penalties?
Penalties for benefit fraud include:
- loss of benefits for up to three years;
- repayment of overpaid benefit;
- a criminal record;
- an administrative penalty of between £350 and £5,000 (where you are fined but avoid a criminal record);
- possible prison sentence.
Benefits that can be reduced or withdrawn are called ‘sanctionable’, and include:
- Carer’s Allowance
- Employment and Support Allowance
- Incapacity Benefit
- Income Support
- Industrial Death Benefit
- Industrial Injuries Disablement Benefit
- Industrial Injuries Reduced Earnings Allowance
- Industrial Injuries Retirement Allowance
- Industrial Injuries Unemployability Supplement
- Jobseeker’s Allowance
- Severe Disablement Allowance
- Housing/Council Tax Benefit
- Pension Credit
- Universal Credit
- War Disablement Pension
- War Widow’s Pension
- War Pension Unemployability Supplement
- War Pension Allowance for Lower Standard of Occupation
- Widowed Mother’s/Parent’s Allowance
- Widow’s Pension/Bereavement Allowance
- Working Tax Credit
Benefits that can’t be reduced or stopped
The following benefits can’t be reduced or stopped if you commit benefit fraud:
- Attendance Allowance
- Bereavement Payment
- Child Benefit
- Child Tax Credit
- Christmas Bonus
- Council Tax Benefit
- Disability Living Allowance
- Graduated Retirement Benefit
- Guardian’s Allowance
- Industrial Injuries Constant Attendance Allowance (where a Disablement Pension is payable)
- Industrial Injuries Exceptionally Severe Disablement Allowance (where a Disablement Pension is payable)
- Personal Independence Payment
- State Pension
- Social Fund Payments
- War Pension Constant Attendance Allowance
- War Pension Exceptionally Severe Disablement Allowance
- War Pension Mobility Supplement
If you commit fraud on a benefit that can’t be reduced or stopped, your other benefits can be reduced instead.
If you commit benefit fraud and you’re on any of the following benefits, none of your benefits can be stopped or reduced:
- Diffuse Mesothelioma Scheme (2008)
- Health in Pregnancy Grant
- Maternity Allowance
- Pneumoconiosis (Workers’ Compensation) 1979
- Statutory Adoption Pay
- Statutory Maternity Pay
- Statutory Paternity Pay
- Statutory Sick Pay
Time limits for investigating benefit fraud
There is no time limit for recovering a benefit overpayment – you could be investigated several years after the alleged fraud took place. There is, however, a six-year time limit for taking court action to recover the overpayment.
Appealing against a benefit fraud decision
If you think a decision concerning your benefits is incorrect, you have one month after receiving the decision letter/email to challenge it (this may be extended by 14 days if you ask for written statement of reasons for the decision or if special rules that allow more time apply to you).
If you don’t agree with a decision you must ask the Department for Work and Pensions (DWP) to look at the decision again (a reconsideration). If the reconsideration doesn’t go your way, you can appeal against the decision to an independent tribunal.
Some benefit fraud decisions cannot be appealed. The letter explaining the decision will make it clear if this is the case.
How to appeal
After the reconsideration, the DWP will send you two copies of a Mandatory Reconsideration Notice. Ensure you send one copy of this to the HM Courts and Tribunal Service (HMCTS) with your appeal form (Form SSCS1) within one month. Your appeal will not be accepted without it
Reporting benefit fraud
Benefit fraud can be reported online, by telephone or by post. Go to the DWP website for further information. You can make an anonymous report if necessary, all reports are treated in confidence. It does help if you do provide your details so you can be contacted for further questions if necessary.
What information do you need to provide when reporting fraud?
The law requires that there be good reason for investigating someone for benefit fraud, therefore it is essential to provide as much of the following information as possible:
- the name and address of the person that is being reported;
- the type of benefit fraud they are thought to be committing;
What happens after someone is reported?
The Department for Work and Pensions Fraud and Error Service will look at the information you give. This investigation may take some time, and no notification is given to the informant of any action taken. It is possible that no action is taken if, for example, a change in a person’s circumstances does not affect their benefit claim.
How benefit claims are checked for benefit fraud
The information given in a benefit claim is checked by DWP to make sure it is accurate. This is a routine check and includes; comparing the information the claimant has provided with records about them held by other government agencies. For example, HM Revenue and Customs (HMRC) will know if the claimant is paying tax or working, and will be able to confirm the claimant’s earnings. Local authorities will also be contacted for information about the claimant before administering any benefits.
The DWP can make checks at any time, not only when the initial claim is made.
What if there is a problem with a claim?
If the DWP’s enquiries find that the information from other government agencies does not match the benefit claim, authorised DWP fraud investigators may visit the claimant at their home or request that they attend an interview.
What if you’re suspected of benefit fraud?
Enquiries can be made only where there are reasonable grounds to think benefit fraud has been committed. If this is the case, DWP fraud investigators will look into your details more carefully. Your benefits may be suspended while they investigate. They will compare information about you and your family with information already given on your claim forms or in interviews.
Personal information and your rights
The DWP collects and holds any information about you relating to your benefit claim. The law allows the DWP to compare this information and share it with other organisations and government agencies.
The Data Protection Act 1998 (DPA 1998) gives you the right by law to know what personal information is held about you by organisations. To find out how DPA 1998 affects you, download a leaflet on the DWP website.