Fraud

 

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Fraud
Whistleblowing
National Fraud Initiative - privacy notice

 

Fraud

In March 2012, the National Fraud Authority estimated that fraud costs the UK over £73 billion a year.  It estimated that the loss in the public sector was £20.3 billion, with £2.2 billion of this specific to local government.  In the public sector, every pound lost through fraud directly affects citizens by increasing national and local taxation, or threatening the provision of local services.

The Government is committed to the reduction of fraud in the public sector and has launched a number of schemes to improve fraud prevention and detection.  In 2016, the revised “Fighting Fraud & Corruption Locally – The Local Government Counter Fraud and Corruption Strategy” document was published through CIPFA to provide a blueprint for a tougher response to fraud and corruption perpetrated against local authorities.   (The full report can be found at http://www.cipfa.org/services/counter-fraud-centre/fighting-fraud-and-corruption-locally).

This Council is, and always will be, committed to combating fraud to ensure that residents receive the best services and value possible.  The Council’s Chief Executive (Nigel Lynn) has affirmed that:-

“This Council recognises that fraud is a significant issue nationally and that every successful fraudulent act places an additional financial burden on the honest residents and taxpayers of the District.  In collaboration with both central government and our local partners, we will ensure that effective ongoing measures are in place to prevent, detect and pursue fraud against the Council.”

While the strategy identifies a number of potential fraud categories in the public sector, 3 key fraud areas that are likely to be prevalent and which directly impact the Council and its residents are:-

  • Housing tenancy fraud
  • Council Tax fraud
  • Benefits fraud.

Arun District Council (along with all other UK Councils and a number of other bodies) has for some years participated in the National Fraud Initiative, now operated by the Cabinet Office.  This is a data matching exercise that has identified significant amounts of fraud nationally over the years.  The Council also undertakes its own, local, initiatives to identify and combat fraud, with details of successful initiatives / cases publicised in the local press. recent successes.pdf [pdf] 397KB

However, estimates indicate that a substantial number of fraud cases remain undetected by these initiatives and it is recognised that it is essential for the public to be aware of the issues and for them to be able to easily raise their concerns for further investigation and appropriate action.

Housing tenancy fraud is the unauthorised occupation of social housing (provided by the Council or a registered social landlord e.g. a housing association), usually to make a profit.  This can include unlawful sub-letting, knowingly giving false information on applications for housing or for the Right to Buy and false claims to succeed to a social housing tenancy.  Minimum estimates are that unlawful sub-letting is present in at least 1% of the social housing stock nationally, with the figure rising to 3% in London, representing at least 50,000 properties across the country (with some estimates being significantly higher).

Unlawful occupation has a direct financial impact on local authorities, as they are responsible for providing and paying for temporary accommodation for homeless people who could otherwise be housed.  It impacts residents, as it restricts the available housing stock and increases the waiting time for those genuinely in need of, and entitled to, social housing.

Where such fraud is detected, the Council can take civil action to repossess a property.  While this can be a drawn-out and complicated process, the Government has recognised the importance of this area and introduced legislation to make unlawful sub-letting of social housing a criminal offence (the Prevention of Social Housing Fraud Act 2013).  This now allows a much simpler method of prosecution and also recovery of any profit made by the fraudster.

In the event of concerns over housing matters, you should contact the Council’s Neighbourhood Housing Team, who now employ a specialist Fraud Investigator (via 01903 737878), or one of the alternative confidential contact points noted below.

Please see:  Privacy Notice Fraud.docx [docx] 21KB

Council Tax fraud is most evident in the abuse of Single Person Discount (SPD), where estimates are that 4-6% of claims are ‘fraudulent’.  The Council already undertakes a number of initiatives to identify and address such cases, including the use of credit reference agency services to perform data matching to a wide range of external data in order to identify potential cases of abuse for investigation.

It should be noted that it is the taxpayer’s responsibility to notify the Council of any changes in circumstances that may alter the entitlement to a discount.  Failure to do so or to knowingly supply false information may result in the imposition of a penalty or fine.  

SPD of 25% is allowed where only 1 qualifying adult resides at a property.  If you are unclear as to whether you are entitled to the discount, you should contact the Council’s Revenues Department (01903 737752) to discuss your circumstances.

Benefits fraud includes both housing benefit (provided by the Council on behalf of the DWP) and local Council Tax Reduction Scheme, where some people will try to obtain a benefit when they may not be entitled to one, or continue receiving payments / reduction when they are no longer eligible e.g.:-

  • people who are working but do not declare this when they claim benefit
  • people who claim as a single person but actually live with a partner
  • people who claim from an address, but do not actually live there
  • people who do not tell us the full amount of income, savings or capital when they claim benefit.

The Council receives referrals from a number of different sources, including various departments within the Council, other Councils, the Police and members of the public.  Allegations of fraud will usually be dealt with by specialist investigators employed by the Department of Works & Pensions (DWP).

If an investigation finds fraud has been committed, consideration will be given to pursuing a prosecution against the person or persons involved depending on the circumstances and gravity of the case, and also measures will be taken to recover payments or discounts improperly claimed.

The DWP operates its own sanctions policy in addition to the recovery of overpayments, which can involve prosecutions, administrative penalties (effectively a fine in lieu of prosecution in appropriate circumstances) or a formal administrative caution, which is registered nationally and can be cited in court if there is a conviction against a further benefit offence.  (Details of the DWP policy can be found at https://www.gov.uk/government/publications/penalties-for-social-security-fraud-and-error/penalties-policy-in-respect-of-social-security-fraud-and-error).

If you have any benefit queries you should contact the Council’s Benefits Department (01903 737753).  Anyone wanting to report a suspected benefit fraud can contact us in person, by telephone or email.  Alternatively, you can complete an online form on our website (www.arun.gov.uk).  Specific benefit fraud concerns can also be reported (in confidence) via the National Benefit Fraud Hotline (0800 854440).

 

Whistleblowing

The Council also operates a whistleblowing policy.pdf [pdf] 26KB in accordance with the requirements of the Public Interest Disclosure Act 1998. This allows members of staff and the public to raise concerns about unlawful conduct, financial malpractice or dangers to the public or the environment. (Full details are contained on the Council’s website).

The Council has a direct whistleblowing line (01903 737556) and any matters raised may be handled confidentially, or anonymously, as required. Additional, external advice is also available from a number of other sources e.g.:-

• the independent charity Public Concern at Work on 020 7404 6609. Their lawyers can give you free confidential advice at any stage about how to raise a concern about serious malpractice at work
• the independent charity Crimestoppers on 0800 555 111. They provide information and advice about fraud and the facility to give information anonymously.

 

National Fraud Initiative - privacy notice

Arun District Council is required by law to protect the public funds it administers.  It may share information provided to it with other bodies responsible for; auditing, or administering public funds, or where undertaking a public function, in order to prevent and detect fraud.

The Cabinet Office is responsible for carrying out data matching exercises.

Data matching involves comparing computer records held by one body against other computer records held by the same or another body to see how far they match.  This is usually personal information.  Computerised data matching allows potentially fraudulent claims and payments to be identified.  Where a match is found it may indicate that there is an inconsistency which requires further investigation.  No assumption can be made as to whether there is fraud, error or other explanation until an investigation is carried out.

We participate in the Cabinet Office’s National Fraud Initiative: a data matching exercise to assist in the prevention and detection of fraud.  We are required to provide particular sets of data to the Minister for the Cabinet Office for matching for each exercise, as detailed here.

The use of data by the Cabinet Office in a data matching exercise is carried out with statutory authority under Part 6 of the Local Audit and Accountability Act 2014.  It does not require the consent of the individuals concerned under the Data Protection Act 1998 or the General Data Protection Regulation.

Data matching by the Cabinet Office is subject to a Code of Practice.

View further information on the Cabinet Office’s legal powers and the reasons why it matches particular information.  For further information on data matching at this authority please contact internal.audit@arun.gov.uk.

The following Privacy Notices (known as Fair Processing Notices before 2018) have been published by the Council for recent data matching exercises:-
Privacy Notice 2018.docx [docx] 18KB
Fair Processing Notice 2017.pdf [pdf] 11KB