Benefit fraud - the cost and results

One of the strategic responsibilities of the Department is the administration of social security benefits. The Department pays benefit to those who are entitled and has a responsibility to detect and investigate benefit fraud and customer error. Fraud is a means of deliberate theft and costs about 0.5 per cent of total benefit expenditure.

The cost of benefit fraud

The estimated level of benefit fraud has reduced from £60.9m back in 2001. It is estimated that in 2014, £25.2m of public money was lost through benefit fraud. This figure is made up of:

  • £9.5m – Employment and Support Allowance
  • £7.7m – Jobseeker’s Allowance
  • £4.8m – State Pension Credit
  • £1.7m – Carer’s Allowance
  • £1.3m – Income Support
  • £0.18m – Incapacity Benefit

It is also estimated that a further £18.4m was lost through Housing Benefit fraud.

Results

We have a team of dedicated fraud investigators who work across Northern Ireland. Our investigators have a variety of tools and powers at their disposal to help them detect benefit fraud. These include:

  • the wide use of data matching, both between our own computer systems and with those of other government departments like HMRC
  • the Regulation of Investigatory Powers Act 2000 which allows investigators to conduct covert surveillance on suspected fraudsters
  • powers introduced by the Social Security Fraud Act (NI) 2001 which require third parties, such as banks, credit card companies, utility companies and educational establishments, to provide information that could help detect benefit fraud when requested to do so by investigators
  • co-operation with colleagues in the Republic of Ireland’s Department of Social Protection to reduce the opportunities for and to detect cross border fraud
  • the increased use of intelligence and analysis to identify fraud trends which allows us to effectively focus resources on those areas most at risk to fraud
  • powers introduced by the Social Security Administration (Northern Ireland) Act 1992 enabling authorised officers to obtain information from employers

Benefit fraud

Benefit fraud investigators are highly trained in all aspects of fraud detection and have a nationally-accredited fraud investigation qualification.

In the 12 months from April 2013 to March 2014

  • 5,322 investigations were concluded
  • £5.6m had been overpaid in benefits - this money has to be repaid to the Department

During the same period:

  • 449 administrative penalties (similar to a fine) were issued
  • 294 people were successfully convicted for benefit fraud

Sentences handed down by the courts included custodial sentences, suspended prison sentences, probation orders, community service orders and monetary fines. A conviction results in a person having a criminal record.

Repayment

In all cases, irrespective of the sentence, those found guilty of benefit fraud are required to repay the amount of money they fraudulently obtained.

Financial investigations

The Financial Investigation Unit was established in 2005. It uses powers granted under the Proceeds of Crime Act (POCA) 2002 to trace and recover money by way of Confiscation Orders in serious benefit fraud cases. In the 12 month period April 2013 to March 2014 FIU was successful in obtaining 20 orders to the value of £356k, and eight voluntary payments totalling £140k.

Fraud costs

It is your money that is being stolen and with your help it can be prevented reduced and recovered.

Remember – 'beating fraud is everyone’s business'

Help us to protect your money

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