Crack fraud unit uncovers £500k of illegal claims against Preston, Lancaster and Fylde councils

Fraud totalling almost £500,000 was uncovered last year by a specialist team set up jointly by three Lancashire councils, it has been revealed.

Thursday, 23rd July 2020, 3:45 pm
Investigators found almost 200,000 had been overclaimed in Preston alone.

An anti-fraud unit operated by Preston, Lancaster and Fylde Councils found the authorities had paid out £456,067 between them in fraudulent claims for council tax, housing benefit, council tax support and business rates.

The figures are contained in a report by the joint corporate fraud team for the 2019/20 financial year due to be presented to Preston's audit committee next Wednesday.

Councillors will hear that the figure came despite the unit not being able to complete some of its investigations due to Covid-19. All interviews and criminal proceedings had to be suspended in February because of the pandemic.

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Preston's overpayment share amounted to £195,496, with Lancaster dishing out £147,477 and Fylde the remainder.

The report says the unit, which has six staff, was set up by the councils in 2015 with government funding "to prevent, detect and investigate fraud and error in council tax support, council tax, business rates and other areas of fraud committed against the authority."

The team also works with Lancaster's housing department and a number of social housing providers to investigate tenancy fraud.

In the year up to March 31, 2020 the unit found "overpayments" totalling £456,067.

On top of that was an amount which it is estimated each authority will save going forward because the fraud was uncovered and stopped. In Preston's case that is expected to be almost £136,000 for the year.

"When a claim for an allowance, discount, reduction, benefit or exemption ends or reduces as a result of an intervention by the team, the value of the intervention is not just the amount of any overpayment that has occurred," says the report.

"It is recognised that there is also a future saving, resulting from preventing further incorrect payments being made.

"Covid-19 had a significant impact on the team's operations. From February 2020 all formal action was suspended. The team was unable to undertake formal interviews under caution, visit members of the public (witnesses, suspects etc) or pursue criminal proceedings due to the pandemic.

"Covid19 saw a new area of fraud for the team to investigate with the Small Business Grant Fund and Retail, Hospitality and Leisure Grant Fund introduced on the 17th March 2020. Investigations in this regard are both pre and post payment."