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Forum Home  →  Discussion  →  Universal credit administration  →  Thread

Advance payment fraud: client as victim

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ekc
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Andrew Dutton - 22 August 2019 09:15 AM

latest one in:

Claimant responds to Snapchat message saying apply for a cheap loan - was given by the ‘loan company’ what sounds like the UC application address, sets up UC account and then gives the fraudsters the login details.

They claimed £1500 advance and got the claimant to give them a ‘processing fee’ of £900.

Claimant later received a message from the ‘loan co’ saying they could check for ‘eligibility’ for a second loan. Somehow they got £1500 and ‘charged’ £750. Claimant was not involved in this application other than agreeing to have eligibility checked. How and why did DWP pay out a second time?

Fraudsters than added children called ‘F**k’ ‘The’ and ‘System’ and then added further children called ‘Free’ and ‘Money’.

The fraudsters aren’t just running rings round the DWP, they are trolling them too.

What was the timeline here? If the fraudsters were able to complete the victim’s ID check online, could the second “loan” be her first regular UC payment, 5 weeks after the initial scam?

Andrew Dutton
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‘What was the timeline here? If the fraudsters were able to complete the victim’s ID check online, could the second “loan” be her first regular UC payment, 5 weeks after the initial scam?’

Difficult to say, still gathering details. It is however very likely that the victim had no UC entitlement whatsoever owing to earned income.

Matters are further complicated by the fact that the fraudsters, having been given the login details, have changed them and the victim can’t log on. It is to be hoped that DWP has closed the claim! They are certaiinly aware of the problem - another IUC case.

Andrew Dutton
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Two more cases - ‘government loan’ offered on social media, claimants persuaded to hand over personal details and then most of the advance.

Andrew Dutton
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One claimant, seen at IUC without representation or advice, has now been asked to accept an Admin Penalty.  They have become so worried, they have accepted the AP in the hope that it will close the matter. and they will not fight on.

Still not clear what offence the claimant is supposed to have committed.

Has anyone else seen this happening?

MikeMay
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I have seen this with a letter saying that they will impose a penalty rather than prosecute. They also sent two letters. One with the Cl’s name and details the second with the Cl’s name and somebody else’s details.

Andrew Dutton
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MikeMay - 17 September 2019 10:16 AM

I have seen this with a letter saying that they will impose a penalty rather than prosecute. They also sent two letters. One with the Cl’s name and details the second with the Cl’s name and somebody else’s details.


Doesn’t inspire confidence in the process does it?

Ros
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The DWP has just updated its guidance to claimants to say that can’t apply for an advance until have had identity verified at jobcentre -

https://www.gov.uk/guidance/universal-credit-advances

Pete at CAB
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Ros - 18 September 2019 03:36 PM

The DWP has just updated its guidance to claimants to say that can’t apply for an advance until have had identity verified at jobcentre -

https://www.gov.uk/guidance/universal-credit-advances

Long overdue, why on earth did it take until now?

LisaL
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Has anyone come across a situation where their client has been scammed, the money went into their bank account thinking they had applied for a loan, the tax credits have been stopped, she has reported it to the police, action fraud etc, given the details to tax credits and once investigated they have allowed the legacy benefit claim to be reinstated and continue. They themselves have not opened a UC claim and the original claim opened by the fraudster has been closed down.  I am trying to establish whether its worth waiting to see if the TC claim will be reopened, obviously whilst waiting, client is not receiving money delaying the inevitable UC claim.

Andrew Dutton
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LisaL - 25 September 2019 05:02 PM

Has anyone come across a situation where their client has been scammed, the money went into their bank account thinking they had applied for a loan, the tax credits have been stopped, she has reported it to the police, action fraud etc, given the details to tax credits and once investigated they have allowed the legacy benefit claim to be reinstated and continue. They themselves have not opened a UC claim and the original claim opened by the fraudster has been closed down.  I am trying to establish whether its worth waiting to see if the TC claim will be reopened, obviously whilst waiting, client is not receiving money delaying the inevitable UC claim.

I have had just one who was restored to legacy benefits,  a severely disabled person who very plainly had been exploited and could not have made the claim in person.

DWP did not explain its reasons for the decision, and they are still trying to hold the claimant liable for the UC advance. The claimant’s MP is taking this matter up.

HMRC appears to defer to DWP’s judgment on whether legacy benefits should be restored.

To speed matters up, I’d suggest getting your person’s MP involved to get a decision from DWP. 

 

Sue Sowerby
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We have just had our first fraud case here believe it or not! Our client is self employed, living with a partner, no children. In receipt of tax credits, partner in receipt of PIP but nothing else (she had a previous claim to IR ESA but this stopped due to clients earnings). He knew nothing until legacy benefits stopped, letter from tax credits explained that this was because he had claimed UC. Our client cannot read or write so it was actually several months before he realised his money had stopped. Several calls to UC & local partnership team have established that a claim was made in Manchester (we are in Cumbria) using clients details, for a couple with 3 children, advance claimed and paid, presumably either just before the rules changed about needing to verify ID before advance payable, or using fake ID. Following over a months wait for news from the DWP about their investigation, the local partnership manager has now contacted us to advise that our client cannot return to legacy benefits, he will need to make a new claim (telephone as not computer literate), will not have to pay the advance (fingers crossed on that one - this may change as they are still investigating) and can ask for a backdate right back to when tax credits ended. Not great for our client as he has low self employed earnings so may be affected by the MIF, but we have suggested that he declares himself a carer for his partner so that he will not be subject to the all work related requirements & the MIF shouldn’t be applied. Partner previously had ESA with support component but on UC would now have to start a new WCA before this element could be applied again and a work allowance given. He is understandably very reluctant to apply for UC so hasn’t done so yet. Although the investigation seems to be still ongoing we have not been given any more info on this, and our client rightly feels that if he claims UC there will never be any going back. We have suggested he or we raise this with his MP but not sure what else we can do.

Andrew Dutton
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There is something new here if this is an identity theft (at some remove) as well as 3rd party fraud.

The person wasn’t conned by fake Jobcentre staff or lured in to taking out a ‘loan’? I take it the bank account to which the advance was paid wasn’t his?

If the claim was made with stolen information without any participation (however innocent) from the claimant, DWP needs to think about how the fraudsters got this information.

There has to be an argument here that no effective UC claim was ever made as the claimant didn’t make it – ‘not properly made’, wasn’t that Neil Couling’s phrase?

So there was nothing to terminate existing legacy benefit claims, no basis for a UC claim to be accepted and no lobster pot.

I think going to the MP is going to be the best route – DWP don’t seem to be at all consistent in their decisions about whether or not to restore legacy benefits.

I can’t quite see how backdating would work if they did claim UC, either. That seems to involve a level of flexibility that the UC rules just don’t have.

It may be worth raising this whole issue with the All-Party Parliamentary Group on UC - https://appguniversalcredit.org.uk/ - I mean you , me, Rightsnet, NAWRA, everyone!

Sue Sowerby
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Thanks Andrew, the advance payment didn’t go into our clients account, and he is not aware of any contact by officials offering a loan etc as has happened before. It does seem to be more of a case of identity theft, not sure why these people can’t be tracked down from the bank details they have provided for the payment, unless they used fake ID to open an account. We will try the MP and will let you know of any outcome.

LisaL
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Many thanks for responding Andrew, I feel it is unlikely her TC’s will be reinstated as he took the ‘loan’.  I have directed her to her MP.

Daphne
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Written answer today which sets out the number of advance fraud investigations being undertaken each month since February this year - up to 5,300 in September. It continues -

As the scale of this issue has increased, we have dedicated more resource to the team investigating this fraud. We have also worked with operational staff to improve the referral process. This allows referrals to be routed to investigators and progressed more quickly.

Andrew Dutton
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Andrew Dutton
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https://www.gazettelive.co.uk/news/teesside-news/universal-credit-scam-dwp-loans-17253327

Report dated 13/11/19 and mentioned on the ‘Benefits and Work’ site.

A DWP spokesperson said: “Fraud is a callous crime fleecing money from those who really need it. Anyone who thinks they’ve been a victim of fraud should contact Action Fraud on 0300 123 2040.”

DWP is still trying to push many fraud victims in to going through an IUC, which is an exploration of allegations against the interviewee, not against a third party.

The letter requesting the claimant attend IUC is very intimidating and, as above, is based on allegations against them.

One victim of fraud is alleged by the letter to have ‘misrepresented your circumstances’ in order to obtain a UC advance.

As I have pointed out before, this person is either a victim of crime - so no offence has been committed by them -  or they claimed the UC and the advance themselves, in which case the claim and the payment are completely legitimate - so no offence has been committed by them. In the latter scenario, why they would then pay over most of the advance to a stranger and then complain of being cheated is a mystery.

I have seen a draft ‘new’ IUC letter which is meant to address the third-party fraud issue a little more sensitively.

It does not; it is even worse than the current one.

Here are the key words a claimant will come across when reading it - bear in mind they are complaining of being a victim of crime:

Police

Arrest

Loss of benefit

Crown Prosecution Service

Proceedings

Court

Criminal offence

Criminal proceedings

Arrest

Police and Criminal Evidence Act

Caution

Defence

Court

Right to silence

Prosecuting you in the criminal courts

Court

Court

Court

Court

Legal advice

 

 

CHAC Adviser
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Can I just check what the current advice is when you come across one of these cases? We’ve had a client who has been a victim of this and all their legacy benefits have stopped and DWP are recovering the advance. The client has spoken to the Jobcentre (I believe face to face) and has been told nothing they can do they’re stuck but I was under the impression that they should be returned to legacy benefits? Also that the advance is not recoverable in these circumstances?

Andrew Dutton
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DWP policy is all over the road about this, but they did state that they would return the claimant to legacy benefits where the UC claim was ‘not properly made’, although they have failed to define what they mean, as far as I know. 

I have only known one case so far where legacy benefits have been restored and even then the legal basis for doing so was not explained.

Same mess with the advances - DWP said they would only recover the portion of an advance that the claimant retained, but in my legacy case referred to above, the claimant had all but £25 taken from her but DWP wants the lot back. They have, again,  been asked for the legal basis of this decision: silence has ensued.

Definitely matters to take up with our MPs, when we have some.

CHAC Adviser
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Thanks for that Andrew. I was rather worried it might be something along those lines. The client is back in later this morning and the adviser working with them is pretty tenacious when needed so we’ll see what they can get out of the DWP! And we’ll take it up with the MP once there is one again.

shawn mach
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Via the BBC:

A woman who assessed people for universal credit has been sentenced for making fake claims and cheating people out of their cash.

The claims team manager ... who worked at a universal credit service centre in Wigan, misrepresented her own circumstances on two applications and stole five additional identities before submitting a further five fraudulent claims in their names ..

... [she] used her own bank account details to receive the universal credit advance payments and also diverted advance payments from three other claims into her bank between September 2018 to April 2019.

Wigan universal credit manager stole claimants’ payments

 

nevip
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And yet she only received a suspended sentence!

NAI
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shawn mach - 20 December 2019 11:24 AM

Via the BBC:

A woman who assessed people for universal credit has been sentenced for making fake claims and cheating people out of their cash.

The claims team manager ... who worked at a universal credit service centre in Wigan, misrepresented her own circumstances on two applications and stole five additional identities before submitting a further five fraudulent claims in their names ..

... [she] used her own bank account details to receive the universal credit advance payments and also diverted advance payments from three other claims into her bank between September 2018 to April 2019.

Wigan universal credit manager stole claimants’ payments

I wonder if she was capable of assessing anyone for anything. After all, she did use her own bank account.

[ Edited: 20 Dec 2019 at 08:55 pm by NAI ]
Mike Hughes
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nevip - 20 December 2019 11:49 AM

And yet she only received a suspended sentence!

Presumably not in a vulnerable group and therefore not worthy of targeting.